Your Edge In Biotech.
10
Jul
2020

The Remdesivir Pricing Letter Gilead Should Have Written

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10 Jul 2020

Peter Kolchinsky, managing partner, RA Capital

Dear America,

We’ve decided to grossly underprice remdesivir.

Hundreds of thousands of COVID-19 patients in America, and even more around the world, need our drug. But the US insurance system is corrupt and heartless. It has demonstrated that it will go to great lengths to prevent patients from getting appropriate, physician-prescribed treatments. You know their tricks: high deductibles, high copays, lengthy prior authorization forms, phone calls unreturned, surprise bills for patients.

Sadly, these barriers are common practice. So we decided to underprice remdesivir to get around the barriers, and make it as fast and easy as possible for all patients to quickly get this much-needed medicine.

In normal times, we drug developers have plenty of time to devise a counterstrategy. Development of new therapies typically takes years. That long lead time enables us to make the case for the value of our innovation and its proper use, and to plan our strategy for negotiating with insurers to lower barriers to accessing treatment. Knowing they often won’t, we usually also have time to set up patient assistance programs that help patients afford the out-of-pocket costs demanded by their insurance plans.

With remdesivir, amidst the COVID-19 pandemic, we don’t have that time. So, we have opted to undercut the value of our innovation to get the therapy to as many patients as possible as soon as possible.

The price we settled on is $2,340 for a five-day course for governments in the developed world, and for the US Department of Veterans Affairs and the US government’s Indian Health Services. U.S. private insurers, in addition to Medicare and Medicaid, will pay $3,120. At this price there’s really no excuse for a private insurance plan or Medicare to put up barriers (though it somehow still won’t come as a shock if they try).

Having to combat insurers’ bureaucracy with our own counter-bureaucracy wastes society’s and our company’s resources. But our insurance system has succumbed to pathological bloat and learned to feed off the bureaucracy. It has learned to extort a profit stream from all drugs, regardless of how expensive they are, to pad their own incomes.

These insurance companies invent nothing and gaslight America into thinking they are doing favors for patients. Why do insurers require that doctors seek prior authorization to confirm that a medicine is medically necessary for a patient and then, after granting authorization, still demand high copayments that many patients cannot afford?

They will say they are trying to prevent over-utilization. They will claim that is the purpose of this “skin in the game.” But really, they are trying to prevent appropriate utilization. That is not insurance. That is disgusting.

Today, we cannot play these games. COVID-19 has filled our hospitals and ravaged our economy. So, we will eat this one. In addition to all the doses of remdesivir we have donated, we are pricing remdesivir at a fraction of what we know America tacitly recognizes it is worth.

Think about how much the US has already sacrificed to save millions of lives from COVID-19. The country has spent $6 trillion dollars to save what would likely have been about two to three million lives lost if the virus had been allowed to run rampant. That comes to about ~$2M-$3M per life. Remdesivir trials have demonstrated that the drug plausibly cuts mortality by ~30% and saves the life of one person for every ~30 who are treated.

The US has demonstrated that it values each life saved from COVID-19 at $2 million or more, so should be willing to spend more than $60,000 on a course of remdesivir. At $20,000, remdesivir would be an extraordinary bargain, leaving plenty of margin for error if it turns out that the drug is less effective than so far shown in trials.

Political organizations like ICER will ignore this logic. But ICER is backed by a billionaire who thinks that people would do a better job of curing their kids’ sickle cell disease and cystic fibrosis if only they had more skin in the game. That is a particularly insidious form of libertarianism better understood as “You’re free to die of treatable diseases I’d just as soon not pay to solve, because I’m rich and those diseases don’t affect me.”

Americans disagree, as evidenced by the tremendous sacrifices so many have made to save lives.

And yet, we’re charging only $2,340-$3,120 for remdesivir. That does not mean we agree that the benefit remdesivir offers is only worth $3,120. Far from it – our price is about 20-fold less than it is worth just based on its odds of saving lives. And remdesivir’s clinical trials also show it can probably cut the length of hospital stays for COVID-19 patients by an average of four days. In the US, that means about $12,000 in savings per patient. [Clarification: 5:51 pm PT July 14. An earlier version said remdesivir clinical trials show it cuts average length of hospital stays by an average of four days. It has been amended to say “it probably can cut” the length of hospital stays by an average of four days.–LT]

Given how expensive drug development is, how can we afford to underprice our innovation? Fortunately, Gilead remains profitable enough from our past successes that we can deeply discount remdesivir to ensure that all patients get access quickly.

Since Gilead is the biotech adult in the room, let me be clear to the scores of younger, unprofitable, scrappy biotechs out there fighting COVID-19: do as we say, not as we do … for everyone’s sake.

Most small biotechs are supported by investors (which include teachers’ and firefighters’ pension funds, not just billionaires). Their drugs may combine with remdesivir to save even more lives or may even displace remdesivir altogether. Most of those companies cannot afford to underprice their drugs, and they should not.

If investors thought that those companies would have to follow our example, they could very well decide to invest elsewhere. Without the promise of an adequate financial return, these companies would be entirely reliant on government funding. If that seems like a good idea, then you have not spent any time in either industry or the NIH. The government cannot keep up with the thriving, creative innovation engine that private capital has made possible. The NIH funds basic science, yet the drug industry funds the extremely expensive clinical trials and drug development required to turn ideas into products, investing well over $100 billion each year.

That’s not to take away anything from taxpayers. Nothing would be possible without taxpayers.  Gilead is able to be the successful company it is because of US roads, the rule of law, public schools, a science-based FDA, and yes, even some taxpayer subsidies for projects like repurposing remdesivir for COVID-19 after it originally fell short as an Ebola medicine. But all of that government support, necessary as it is, isn’t sufficient to actually create remdesivir.

American taxpayers have elevated private enterprise to Mount Everest’s base camp, already a great height. And yet, taxpayers do not fund the climb to the peak. That’s achieved by the market offering incentives to those who succeed. Without taxpayer support for the foundation on which the biomedical innovation industry exists, there would be no innovation. But without adequate returns for private funding of development, there would be no products.

With profits of only 10-12% of all drug industry revenues, taxpayers would have to spend about 90% of what society spends now to preserve the drug industry as a tax-funded non-profit. Of course, those profits also incentivize talented scientists. Good luck retaining those brilliant people when other for-profit sectors offer them a piece of their profits through valuable stock. As it is, software, real estate, and finance have higher profit margins than the drug industry, so they can entice a lot of talent away.

We will all get more video games and financial instruments, but fewer medicines.

You might think that pharma could cut its sales and marketing budgets, but how will the world know about a useful new drug if nobody spends the time educating physicians and patients about it? Sure, there’s some fat here and there in our industry, and shareholders are constantly pushing companies like ours to find it and cut it. But there isn’t room for us to cut prices by as much as we have cut remdesivir’s if we want to continue to support and incentivize the level of innovation we have today.

So, treat remdesivir as a special case, please. Were all companies obliged to follow our example, the drug industry would become a high-risk/low-reward proposition. Investors would flee, academia would prove itself unequal to the task of developing drugs, and our drug armamentarium would be frozen in its current state. Our kids would have healthcare no better than ours.

The remdesivir case warns us about what is wrong with America’s insurance system. We need insurance reform so that health insurance does what it is supposed to do – pool the risk over large populations of people, so that healthy people are paying the bills for those who are sick. All of us and those we love will become patients at some point, so it’s in society’s interest to ensure fair and equal access to care.

There is no time to fix the systemic problems with US health insurance this week, or this month, so we are expediently making this pricing concession right now. But we urge all other drug companies not to follow our example.

If you invent a drug that advances our standard of care, it is imperative for the preservation of innovation that you confidently charge a price that will generate a return for you and your shareholders and incentivize others to risk their time and money to climb even higher. Congress should anticipate these breakthroughs in the coming months and be prepared to acknowledge their value. Better that America spend tens of billions on medicines that let everyone live normal lives than trillions countering economic depression as everyone hides from a viral terror.

Peter Kolchinsky, a biotechnology investor and scientist, is Managing Partner of RA Capital Management, L.P., and author of The Great American Drug Deal. He is not affiliated with Gilead in any way, RA Capital Management does not currently have a position in Gilead, and this letter represents his own views and is not actually intended to represent Gilead’s views.

9
Jul
2020

Novavax Nabs $1.6B, BD Secures Fast Antigen Test OK, & a Tribute to Tony Fauci

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09 Jul 2020

Luke Timmerman, founder & editor, Timmerman Report

The United States, it pains me to say as a patriotic believer in our Constitutional system and institutions and generally decent and hardworking people, looks like a disaster zone.

A tally of 3.1 million COVID-19 cases, 133,000 deaths, and record numbers of new infections adding up every day can shake one’s faith.

Confidence in US institutions, and faith in government in particular, is at an all-time low.

But indulge me here for a minute to think about a year or two ahead, and to imagine how this low moment could propel us in a more positive direction.

The pandemic has a way of shifting a lot of society’s tectonic plates. An actual reckoning with the nation’s racial legacy now seems within the realm of the possible. There’s a sense of interconnectedness that’s unavoidable, even in this land of mythical rugged individualism, where many people imagine themselves as the sole architects of their own success without any help from teachers, government investments, or anything else in the background that helped along the way.

The pandemic is teaching us about the value of our interconnectedness, and to place more value on other people – “essential workers” – who create conditions we all need to thrive.

Partly because our institutions are still populated by men and women of good faith who care about doing things the right way, and partly because people now have the time and space to re-think some basic assumptions of how our world is organized, I believe it’s possible for us to come out in a year or two with renewed faith in public service and a newly energized, and better supported, government.

This might sound like an odd thing to say in a week when the CDC was forced to revise its carefully considered school reopening guidelines. It buckled under pressure. CDC director Robert Redfield will go down in ignominy for appearing to put the political whims of his boss ahead of the needs of parents and kids. If the plan needs revising, it needs revising, but not because a demagogue just wants to score a point.

That’s dispiriting. Seeing people recklessly run around without masks in crowds, because they don’t believe the science and want to stick it to the experts – that’s worse. It’s what the world looks like at the bottom of a slippery slope of cynicism.

But here’s the thing. I don’t think people are going to buy it for much longer.

The degree of collaboration between government, academia, and industry is real, and sustained. The unified purpose holds it together. Good things are happening, and more good things are happening every week.

Therapeutic antibodies from multiple companies are being aimed squarely at the SARS-CoV-2 Spike protein, which happens to be a pretty good drug target. Dexamethasone is there for ICU patients, and it’s cheap and easy to administer. A portfolio of vaccine candidates are on the way, and at least a couple ought to work and be manufactured at scale.

Now, for a second, consider our through-the-looking glass warped public perceptions.

Few can cut through the noise. But look for a second at Tony Fauci, the nation’s top infectious disease expert. There he is, the raspy-voiced Energizer Bunny. Every day, on seemingly every channel, he’s there. He’s brilliant and he’s relentless.

Never in my lifetime has there been a federal bureaucrat, an unelected civil servant, with this kind of public stature. His nonstop appearances in the media are about communicating clear, concise, sober, timely and balanced information. He’s doing his job, providing information and expert interpretation the public needs. So much for being a nameless, faceless bureaucrat.

But what he’s doing is more important than just delivering the facts, and doing it in context. He exudes scientific competence. He exudes humility. He exudes honesty. People can try to smear him as a member of the Deep State, spouting Fake News. It won’t work.

True, Fauci has made some too-rosy predictions, and said some things he probably would like to take back. But when he errs, he admits it. It’s not about his ego, and that is evident. He has surely had to swallow his pride many times. He has to sit there and listen to asinine comments in meetings (bleach, anyone?) and behave with a certain degree of deference to bungling bozos in power.

By being who he is, and doing what he does with genial relentlessness at the fit-as-a-fiddle age of 79, Fauci is almost making government cool. This work is chipping away at cynical sentiments about government, and doing the hard work of helping restore our faith in institutions bit by bit.

People may not be inspired to run for public office and endure the ugly food fights of electoral politics. But he may inspire young people to forgo lucrative consulting or Wall Street gigs and roll up their sleeves to do important things that have to be done for the fate of the world.

When it comes time to write his obituary, Fauci could be known for this just as much as for his tireless work on the HIV epidemic in the 1980s and against the COVID-19 pandemic today.  

He could be the guy who helped renew our sense that government can be used as an instrument of broad societal uplift. That it can, and does, make shrewd futuristic investments in science. And, ultimately, that government can be a powerful force for progress right there with industry.

Science

  • Longitudinal Isolation of Near-Germline Neutralizing Antibodies to SARS-CoV-2 from COVID-19 Patients. Cell. July 7. (Christoph Kreer et al)
  • Persistent Symptoms in Patients After Acute COVID-19. JAMA. July 9. (Angelo Carfi et al)
  • Primary Exposure Protects Against Re-infection in Rhesus Macaques. Science. July 2. (Wei Deng et al)
  • Regulatory T cells for Treating Patients with COVID19 and ARDS. Annals of Internal Medicine. July 6. (Douglas Gladstone et al)

Vaccines

Gaithersburg, Maryland-based Novavax pulled in $1.6 billion in funding from the US federal government’s Operation Warp Speed program, to advance its COVID-19 vaccine work. The company’s lead candidate is a stable prefusion protein, delivered in a lipid nanoparticle, and made with a proprietary immune-boosting adjuvant. The money is supposed to push the company through Phase III development, and allow it to make as many as 100 million doses as quickly as the end of 2020. Novavax stock surged on the news, closing at $96.30 yesterday. The 52-week low on the company is a breathtakingly low $3.54 a share.

GSK and Canada-based Medicago struck a partnership to work the small company’s coronavirus-like particles, together with GSK’s adjuvants into a vaccine that could allow doses to be stretched out over larger swaths of the population. The companies expect to be able to produce 100 million doses of this formulation of vaccine by the end of 2021.

NIH launches Clinical Trials Network to test COVID-19 Vaccines and Other Prevention Tools. July 8. (NIH release)

Cambridge, Mass.-based Moderna said it completed enrollment in the 600-patient Phase II clinical trial of its COVID-19 vaccine candidate, with half of the subjects younger adults and half older adults. Plans are to begin enrollment in the Phase III study in July.

Gaithersburg, Maryland-based Emergent Biosolutions secured a 5-year large-scale manufacturing deal to make Johnson & Johnson’s COVID-19 vaccine candidate. Deal value: $480 million for the first two years.

The New York Times is keeping its coronavirus vaccine tracker up to date, with vaccine candidates broken down by phase of development.

Here’s a handy primer from NPR on “all you wanted to know about coronavirus vaccines but were afraid to ask.”

Therapies

Tarrytown, NY-based Regeneron initiated a trio of Phase III clinical trials for its two-drug neutralizing antibody cocktail approach to COVID-19. The studies are being run to assess the double-antibody treatment’s ability to prevent infection (2,000 subjects), to treat hospitalized patients (1,850 subjects), and to treat non-hospitalized patients (1,050 subjects). The trials are using adaptive designs, and are being run in partnership with the National Institute of Allergy and Infectious Disease. Separately, Regeneron said it has secured a $450 million contract from the US Biomedical Advanced Research and Development Authority (BARDA) to manufacture the double-antibody cocktail it calls REGN-COV2. (For more context on this important therapeutic neutralizing antibody approach, read this Q&A with Regeneron SVP David Weinreich, published June 29 in TR).

Burlingame, Calif.-based Corvus Pharmaceuticals said it started a trial of its immune-stimulating antibody candidate being repurposed for COVID-19. It has previously been shown to stimulate antibody production in cancer patients.

Testing

Becton Dickinson won FDA clearance for its fast antigen-based test for COVID-19. This is important because the tests can be run at the point of care, not in some fancy lab somewhere else on campus, and can deliver results in 15 minutes. The test runs on the BD Veritor platform, which has an installed base of 25,000 US healthcare facilities. There’s hope this new type of test could come just in time as testing bottlenecks and delays have become a serious national issue once again.

Regulatory Action

Biogen turned in its controversial Biologics License Application to market aducanumab for Alzheimer’s disease. The company requested an expedited Priority Review.

ViiV Healthcare, the HIV drug developer majority owned by GSK, won FDA clearance to market fostemsavir (Rukobia) for patients with multi-drug resistant HIV-1 infections.

The FDA placed a clinical hold on Cellectis’ MELANI-1 trial of allogeneic CAR-T cells. One patient in the study died from cardiac arrest.

The Infodemic

Public Health

  • I’m an Epidemiologist and a Dad. Here’s Why I Think Schools Should Reopen. Vox. July 9. (Benjamin Linas)
  • A Conversation With John Ioannidis. The Healthcare Blog. July 9. (Saurabh Jha)
  • Reopening America’s Schools. A Public Health Approach. July 8. (Resolve to Save Lives)
  • Americans Are the Dangerous, Disease-Carrying Foreigners Now. Washington Post. July 8. (Erika Lee)

Standing Up Against Racism

  • Good for Us All. JAMA. July 9. (Rachel Isaka)
  • To Be a Young Doctor and Black. Overcoming Racial Barriers in Medicine. NPR. July 1. (Yuki Noguchi)

Features

  • These Scientists at Regeneron Raced to Find a COVID-19 Drug. Then the Virus Found Them. NYT. July 9. (Katie Thomas)
  • Gene Editing Discovery Could Point the Way to Cures for Mitochondrial Diseases. STAT. July 9. (Sharon Begley)
  • Has Italy Beaten COVID-19? MedPage Today. July 7. (Kristina Fiore)
  • Data Show Panic and Disorganization Dominate Studies of COVID19. STAT. July 6. (Matthew Herper)
  • The Dangerous Race for the COVID19 Vaccine. Politico. July 7. (Elizabeth Ralph)

Personnel File

Bob Goeltz was hired as chief financial officer at Hayward, Calif.-based cancer immunotherapy company Arcus Biosciences. He was previously with Unity Biotechnology.

South San Francisco-based Sunesis Pharmaceuticals cut its workforce by 30 percent.

Waltham, Mass.-based Syndax Pharmaceuticals, a cancer immunotherapy company, hired Daphne Karydas as chief financial officer.

Watertown, Mass.-based Lyra Therapeutics, the developer of drugs for ear, nose and throat conditions, hired Robert Richard as senior vice president and head of R&D.

Boston-based Gamida Cell, a cell therapy company focused on blood cancer and other blood diseases, named David Fox, a lawyer with Kirkland & Ellis, to its board of directors.

6
Jul
2020

Writing in the Language of DNA: Kevin Ness on The Long Run

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06 Jul 2020

Today’s guest on The Long Run is Kevin Ness.

He’s the CEO of Boulder, CO-based Inscripta.

This is a startup that calls itself the “digital genome engineering company.”

Kevin Ness, CEO, Inscripta

The aspiration, which Inscripta described in a statement last December, was to create:

The world’s first fully automated benchtop instrument for genome-scale engineering. Consisting of an instrument, consumables, software, and assays, it enables scientists to create libraries of millions of precisely engineered single cells in one experiment through a fully automated workflow.

Instead of reading DNA, it’s allowing scientists to write in the language of life.

The company raised $125 million in a Series D financing last December, bringing its private fundraising total at the time to about $260 million. Venrock, Foresite, JS Capital Management Oak, and Paladin Capital Group are among its backers.

In this episode, I asked Kevin to speak at some length about his life story, his path in mechanical engineering, and how useful that background became once he started learning about the big questions in biology. We talk about the company in the latter part of the episode.

Now, please join me and Kevin Ness on The Long Run.

1
Jul
2020

Pfizer, BioNTech Vaccine Shows Life, but Cases Surge, Testing Falters & Prices Haunt

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01 Jul 2020

Luke Timmerman, founder & editor, Timmerman Report

Catch up on the main happenings in biotech this week, and consolidate your knowledge heading into the holiday weekend.

Stay healthy.

The US recorded 50,000 new cases on July 1 – a worrisome indicator of things to come, indeed.

 

This Week in Drug Pricing

The pharmaceutical industry entered the COVID-19 pandemic as Public Enemy No. 1. Polls showed that pharmaceutical industry favorability ratings in late 2019 were in the single digits, right down there in Big Tobacco territory.

Listeners of The Long Run podcast may recall I spoke with BIO chairman Jeremy Levin, with some dismay, about this existential threat to the industry’s future on the podcast recorded Feb. 10.

Then, the COVID-19 pandemic created an opportunity for positive change. Biopharma has the horsepower to do tremendous good, and it has shown it can rise to the scientific occasion. Through action – showing us, not telling us – the industry has demonstrated there is a larger purpose here other than shareholder value monomania.

If there were ever a time to go all the way and prove it’s about serving patients, this is it. This is the time to dazzle the world with science, and to make the results generously available for all.

Yet this week, we saw a sign that not everyone in biopharma has gotten the memo. Patients for Affordable Drugs reported on 245 drugs that have undergone price increases during the pandemic, including 61 meds commonly given for COVID-19 patients.

For too long, pharma has been addicted to semi-annual price increases on existing drugs. These price increases keep the earnings growing, and the stock price up. They also gloss over a tepid performance in the ability to create valuable new drugs.

Given all the self-congratulatory talking points about partnership and a renewed spirit of the pharma mission for human health this year, raising prices on old drugs look like hypocrisy. It’s the wrong thing to do at the wrong time. The industry ought to be busy writing a new social contract.

Maybe some in the industry don’t see a need to change course. The stock market had its best quarter in 20 years. This could be a recipe for complacency. But that would be a mistake. About 45 million people have lost jobs in the pandemic. We have 29 million renter households in the US at risk of eviction. People are desperate and scared.

Republican Sen. Chuck Grassley told the New York Times on June 27 that he has had continued talks with the President about reviving long-stalled legislation to curb drug pricing. It’s an area of rare bipartisan agreement, to rein in the drugmakers. It could be difficult now for even the most diehard Senate Republicans to stand athwart history and yell “Stop.”

This industry needs to align words and deeds. It’s not too late to work on creating a more stable future for biopharma, one that preserves incentives to develop new drugs, with access for everyone and prices we can stomach.

A High Profile Pricing Call

Gilead Sciences said the price for remdesivir will be $2,340 for a five-day course for governments in the developed world, and the US Department of Veterans Affairs, and the US Indian Health Services. The price will be one-third higher — $3,120 — for US insurers, and Medicare and Medicaid. Gilead said the price was well below the drug’s value, but it set the price there anyway because it wanted to provide “broad and equitable access.” While the company probably perceived itself as being generous, that remark irked patient advocates, who took that as a tacit admission from Gilead that its other medicines for HIV and HCV have been priced too high all along to ensure that same kind of broad, equitable access. Wall Street griped about the price for a different reason. SVB Leerink analyst Geoff Porges called it “remarkably low.”

Given the modest benefit of remdesivir (reduced hospitalization time, but not shown to save lives in a randomized study), I’m more and more enthused about dexamethasone. Thanks to researchers in the UK, we know dexamethasone provided a compelling 33 percent mortality benefit for ventilated patients and 20 percent for oxygen-dependent patients in a well-controlled trial. Dexamethasone is a cheap and widely available generic drug. Thank God. It can be given orally without the extra hospital expense and hassle of five-day IV infusion course. Go get ‘em, Dex!

Annals of Access

Despite the lackluster remdesivir results, our federal government has apparently tried to corner the world supply. Wouldn’t it be interesting if other countries, as the pandemic wears on, decide to block or severely curtail exports to the US of the next promising medicine for COVID-19?

Vaccines

The best news of the week came from Pfizer and BioNTech, developing their mRNA vaccine candidate for COVID-19. The BioNTech team, with collaborators from NYU Langone, published a preprint with results from the first 45 people randomized to get a low, medium or high dose of vaccine between May 4-June 19. The vaccine candidate, BNT162b1, showed very impressive ability to spur IGg antibodies specifically against the Receptor Binding Domain on the SARS-CoV-2 spike protein. The two-dose prime-boost regimen got stronger with time, and the concentration of antibodies (the titer) seen was significantly higher than what researchers saw when looking for those type of antibodies in convalescent plasma from recovered COVID-19 patients. Researchers saw injection site reactions that got more intense as the dose went up, but otherwise subjects just reported mild or moderate fever or chills. These data are still not peer-reviewed, but it’s a significantly more detailed and impressive report than the premature press release from Moderna on May 18 from the first 8 evaluable vaccine recipients who enrolled in its mRNA vaccine study. Moderna can still recover from that unforced error, although anything that smacks of false hope or overpromising threatens to undercut public trust at a moment when we have no wiggle room to squander it.

Read the BioNTech preprint paper on MedRxiv.

Plymouth Meeting, Penn.-based Inovio released an interim report on the Phase I study of its DNA vaccine candidate for COVID-19. It was thin on details, but said there was a low dose and a high dose cohort. Each got two shots. 34 of the 36 evaluable patients had an immune response after six weeks, although the company didn’t describe the type or magnitude of the immune response in its statement. Since the statement said so little, I wonder why it was issued at all.

The FDA told Congress that it will require a COVID-19 vaccine to prevent disease or decrease the severity at least 50 percent of people to receive full approval, although temporary authorizations will be considered.

Testing

As the pandemic has roared back into exponential growth mode the past couple weeks, major lab test providers have sounded alarm bells again that they are struggling to keep up with demand for tests. Quest Diagnostics, one of the big players, said hospitalized patients go to the top of the priority list, and everyone else will have to wait 3-5 days (essentially useless, as people could be walking around without a positive test during prime transmission time). Read The Atlantic update.

Treatments

Boston-based Ginkgo Bioworks said it’s begun testing of a compound it received from Warp Drive Bio (by way of Revolution Medicines), which might have some curious properties against COVID-19. The idea sprang from a Mar. 27 preprint publication by a UCSF team that mapped out protein-protein interactions which the Warp Drive Bio team had made a molecule against. (See Ginkgo blog summary).

Public Health
  • How Arizona Lost Control of the Epidemic. Washington Post. June 25. (Jeremy Duda et al)
  • After Record-Breaking Day of New Coronavirus Cases, California Surpasses 6,000 Deaths. Los Angeles Times. June 30. (Colleen Shalby)
  • US Could See 100,000 New COVID-19 Cases Per Day, Fauci Says. STAT. June 30. (Helen Branswell)
  • CDC Says US Has ‘Way Too Much Virus’ To Control the Pandemic. CNBC. June 29. (William Feuer)
  • National Mask Mandate Could Save 5 Percent of GDP, Goldman Sachs Finds. Washington Post. June 30. (Christopher Ingraham)
  • Want to Prevent Another Shutdown, Save 33,000 Lives, and Protect Yourself? Wear a Face Mask, Doctors Say. CNN. June 29. (Holly Yan)
Science
  • Prevalent Eurasian avian-like H1N1 swine influenza virus with 2009 pandemic viral genes facilitating human infection. PNAS. June 29. (Honglei Sun et al)
  • Endotheliopathy in COVID-19 Associated Coagulopathy: Evidence from a Single-Center, Cross Sectional Study. The Lancet. June 30. (George Goshua et al)
  • Excess Deaths from COVID-19 and Other Causes, March-April 2020. JAMA. July 1. (Steven Woolf et al)
Science Features
The Infodemic

Here’s the weekly reminder that it’s a bad idea to have one person — a person unaccountable to the public and to his own shareholders — in control of the information flow to 2.9 billion people. A company this big and powerful, structured in this opaque and unaccountable way, should not exist. Now we see why. The shit storm on Facebook — the algorithmically amplified hate speech, threats, incitements to violence that spread with viral speed, the bad faith emotional provocations, the idiotic grandstanding like going around maskless and blowing kisses at people, the misinformation and state-sponsored disinformation are overwhelming the platform. Mr. Zuckerberg, after years of second and third and fourth chances, hasn’t been willing or able to alter his business model to reduce the amount of information pollution. It’s built for behavior modification, and bad actors have figured out how to hack it to modify behavior in ways most people don’t like.

This week, we heard that 300 companies are fed up, and have decided to put their money where their values are. Major brands like Verizon and Unilever and Coca-Cola and Pfizer have had enough with the social networking platform, and joined the advertising boycott. Facebook has demonstrated it can’t or won’t create the platform conditions necessary for healthy, reasonable debate in democratic societies. Lip service and window dressing aren’t good enough. The company may have employees who want to do better, but the leader evidently doesn’t care. Facebook and its properties need to go into the dustbin of history. We need to create new platforms for connecting with friends and family, and to set up some regulations and accountability valves for the public.

Data That Mattered

Shanghai-based Hua Medicine reported that a combo of generic metformin and dorzagliatin – a first-in-class, dual-acting glucokinase activator — passed a Phase III trial of 766 patients with Type 2 diabetes. The combo brought down hemoglobin A1C scores by 1.02 percent from baseline to the 24-week checkup, compared with 0.36 percent on the placebo. Hua said 44 percent of patients on the combo were able to get to the recommended A1C score of 7 percent.

Cambridge, Mass.-based Verve Therapeutics presented data from 14 non-human primates showing that it could permanently knock out cholesterol raising genes with a single administration of a DNA base editing technique, licensed from Cambridge, Mass.-based Beam Therapeutics. Verve said it was able to successfully knock out the genes for PCSK9 or ANGPLT3, and this resulted in substantial lowering of cholesterol and triglycerides. Founder and CEO Sekar Kathiresan presented the data at the International Society for Stem Cell Research. The New York Times picked up on the tantalizing possibility of a single-shot cure for cardiovascular disease.

South San Francisco-based Akero Therapeutics released some new histologic data from a Phase IIa study, called BALANCED, of efruxifermin for non-alcoholic steatohepatitis (NASH). At the 16-week biopsy done on the 40 patients who responded to treatment, researchers saw 48 percent had a one-stage improvement in fibrosis, and 28 percent had a two-stage improvement in fibrosis. About half (48 percent) saw a resolution of NASH with no worsening of fibrosis. Shares of Akero climbed 30 percent on the news.

Legal Corner

The US Attorney’s Office for the Southern District of New York announced it secured a $678 million civil settlement with Novartis Pharmaceuticals. The US Attorney’s office had investigated what it described as a sham speaker series conducted by Novartis in order to coax doctors to prescribe the company’s cardiovascular and diabetes medicines. Wonder why the public hates Big Pharma, and is suspicious of expert doctors.

Regulatory Action

Novato, Calif.-based Ultragenyx Pharmaceutical, the developer of treatments for rare diseases, secured FDA clearance for two new medicines in the past two weeks. One is UX007/triheptanoin (Dojolvi) for long-chain fatty acid oxidation disorders. The other is burosumab (Crysvita) for tumor-induced osteomalacia.

Merck won an additional marketing indication from the FDA for the PD-1 inhibitor pembrolizumab (Keytruda), as a single-agent first-line treatment for unresectable colorectal cancer, or colorectal cancer that’s considered microsatellite instability high or mismatch repair deficient.

New York-based Intercept Pharmaceuticals received a Complete Response Letter from the FDA, which chose not to approve an application to market the company’s drug obeticholic acid for fibrosis from non-alcoholic steatohepatitis (NASH). The agency said, according to the company, that it wouldn’t approve the drug because the benefits demonstrated by a surrogate endpoint don’t outweigh the risks.

San Diego-based Heron Therapeutics got a Complete Response Letter from the FDA, which declined to approve an application to market the company’s treatment for postoperative pain.

Pfizer and Merck KGaA announced they won FDA clearance for the PD-L1 inhibitor avelumab (Bavencio) as a first-line treatment for locally advanced or metastatic urothelial carcinoma.

Deals

Cambridge, Mass.-based Carmine Therapeutics entered into a research collaboration with Takeda Pharmaceutical to develop non-viral gene therapies for two rare disease targets using Carmine’s technology, based on red blood cell extracellular vesicles.

Japan-based Sumitomo Dainippon Pharma Oncology announced it was formed this week via the merger of a pair of subsidiaries that are developing cancer drugs – Tolero Pharmaceuticals and Boston Biomedical.

Financings
  • Boston-based Akouos, a gene therapy company for ear diseases, raised $212.5 million in an IPO priced at $17 a share on June 25. The stock traded up over $22 a share yesterday.
  • Hamilton, Ontario-based Fusion Pharmaceuticals, a cancer drug developer, raised $213 million in an IPO at $17 a share on June 26. It traded down to $15.40 yesterday.
  • London-based Freeline, a gene therapy company working on systemic diseases, raised $120 million led by Novo Holdings, Eventide Asset Management, and Wellington.
  • Cambridge, Mass.-based Goldfinch Bio, the developer of genetic-based treatments for kidney diseases, raised $100 million in a Series B financing led by Eventide.
  • Germany-based BioNTech, the mRNA vaccine and therapies developer working on a COVID19 vaccine with Pfizer, said it raised $250 million in a private placement from Temasek and other accredited investors on June 29.
  • Redwood City, Calif.-based Bolt Biotherapeutics raised $93.5 million in a Series C financing led by Sofinnova Investments. It’s working on Immune Stimulating Antibody Conjugates.
Personnel File

Moderna added Elizabeth Tallett to its board of directors. She’s on the board of Anthem, and will join Moderna’s Audit Committee.

Sarepta Therapeutics said Sandy Mahatme, the chief financial and business officer, is leaving the company July 10.

26
Jun
2020

Leadership, Strategy and Capabilities: How We Are Losing The Fight Against the Virus

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26 Jun 2020

Otello Stampacchia, founder, Omega Funds (illustration by Praveen Tipirneni)

“The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence” –Charles Bukowski

The quote above is presented with more than a hint of self-deprecating irony (I did spend some formative years in the UK). Indeed, I am often told I am a little bit too confident in my opinions.

Now, with that disclaimer out of the way…

On May 26, I penned a (quite pessimistic) editorial for Timmerman Report.

I wrote:

“We are going to see a continuous, substantial increase of infections and fatalities in the US starting (very, very roughly) early / late July, if not sooner. Quite likely, by August / September, we are going to revisit the peaks of daily confirmed infections and fatalities we saw in April”.

It turns out I wasn’t pessimistic enough.

As I write again a month later, on June 26, the US just recorded total confirmed cases above 2.5 million (https://www.worldometers.info/coronavirus/country/us/ : please refer to that site for any statistics reported below, unless otherwise stated), as well as over 126,000 deaths. I am not sure this includes the revisions the state of NJ just posted (with an incremental ~2,000 deaths). As discussed in a previous article, fatalities in pandemics are often undercounted.

Nevertheless, this is a tragic situation, and a very different trajectory from other western countries.

COVID-19 in the 10 Most Affected Countries (Confirmed Cases / Day)

Source: Johns Hopkins University Coronavirus Resource Center

Over the past month, the US has seen 800,000 new cases, and 24,000 more deaths. On May 26, US positive tests numbers were ~1.7m and ~102,000 fatalities. For about three weeks, the numbers, while grim, appeared on a daily basis to be trending in the right direction. There was a measurable reduction in overall hospitalizations and fatalities in the US: this was the result of a combination of drastic (and effective) lockdown measures (and citizens compliance with distancing measures) in the hardest / earlier hit regions (NY and New York City above all, and NJ, MA, CT, RI).

Those *inevitable* measures brought temporary, partial control of the pandemic in those regions. Those locations can now, tentatively, and carefully, try to re-open their economies in stages. And be mindful that the virus has not gone away “magically” and that people need to continue to be vigilant and responsible.

However, the uncontrolled spread in the remainder of the country means the proverbial cat is now truly out of the bag. And it is not going to get back in there, either.

Suffice it to say that the 7-day moving average (which smooths out weekend reporting issues) has now reached >34,000 cases/day and it is likely to increase quite a lot in the coming days, now that the trendline is on an inexorable, dramatic upswing (see Florida below). The previous 7-day average peak was ~32,000/day back on April 10. April 29 represented the highest single-day peak of confirmed daily cases until now, with ~39,000 positives (and a very significant decrease in numbers in the following days).

However, yesterday (June 25 for those of you losing track of time) surpassed 40,000 confirmed cases (the highest number of cases in a single day, ever), and almost every day this week has shown confirmed cases above 30,000. I expect today to be much higher. This is not good.

I would like to tackle some commonly heard objections to my message of doom, before reverting to dwelling on the main article topic later on.

OBJECTION No. 1: This is nothing: cases are going up simply because we are testing more! You are such a worrywart! Why do you want to ruin my vacation??

I do not want to ruin your vacation, but, no.

While it is accurate that testing capacity has increased substantially (see www.covidtracking.com for a comprehensive picture on tests, confirmed cases, hospitalizations, and patient outcomes) in the US, to roughly 500k tests performed daily, the percentage of people resulting positive on tests has very substantially increased (we are now roughly at 7-8% positives, vs ~5% only 10 days ago).

So, the percentage of the US population being infected is increasing, and quite rapidly (this should be expected: this is a very contagious virus). It is particularly concerning to see substantial increases in positive rates in populous US states such as California, Texas, Florida (see below in the answer to Objection No. 3).

In the past week alone, Florida’s daily new case count has gone from 3,822 last Friday, to 5,511 on Wednesday, to an astonishing 8,942 today. If you think this is not going to result in a substantial increase in hospitalizations and eventually a massive death toll, I would love to receive a healthy helping of whatever it is that you are smoking.

And, please, before you even ask: we are a long way away from reaching “herd immunity” for the entire population.

OBJECTION No. 2: The virus is simply infecting more of us young people: we are not like those old geezers (insert any proclamation of young invincibility of your choice here)! Worse case scenario, I will take generic steroids once I am getting intubated, I heard it works! (exasperated sigh). As George Bernard Shaw eloquently said, “youth is wasted on the young”… Trying, however, to be more constructive (if not altogether convincing to people who are somehow refractory to reason), here are some counterfactuals:

  1. As Sharon Begley (@sxbegle) wrote today in STAT News, and as reported in a huge variety of published scientific literature, COVID-19 attacks a variety of organs, ranging from the (obvious) lungs to kidneys, heart & cardiovascular apparatus, brain / CNS, and others. Let’s please also not forget that this is a new virus, and that we still do not know much about its long-term effects. There are clear and increasing reports showing that even young, apparently asymptomatic / mildly symptomatic people who recovered from the infection have possibly long-term effects such as reduced lung capacity, potential systemic / long lasting inflammation, and increase in diabetes risk. The US population already is relatively unhealthy to start with, so we really can’t afford to have an exceedingly long tail of co-morbidities plaguing us for years after this pandemic… Is that drink at the bar or that pizza really that important? (Note: a good pizza is indeed very important to me, as an Italian, but, you know, priorities).
  2. The virus spreading uncontrolled amongst the population, even if only in the strata that believe themselves “not at risk”, increases dramatically the likelihood of reaching much more at-risk demographics. Especially since we do not have a proper contact tracing and isolation set of protocols in place (or at all, actually) across the country.
  3. It is true (and great news indeed) that some initial hopeful results are emerging from medical research: the publication of the (robust AND randomized) UK RECOVERY trial results (just published on June 22, after topline data announced on June 18), confirms that oral or IV dexamethasone (a cheap, generic steroid) significantly reduced the 28-day mortality rate among hospitalized patients receiving invasive mechanical ventilation or oxygen (but it didn’t provide a benefit to more moderate patients who weren’t receiving respiratory support). So, yes, dexamethasone (and not other steroids, for those of you who buff up at the gym) appears to save the lives of about one out of every three patients being intubated, and about one out of every five patients who need oxygen support for breathing. BUT, that means the rest of the patients still die. Do the math, and wear a mask.

OBJECTION No. 3: The number of US deaths has not gone back up! It was down recently. Why are you worrying? I want to go to the beach bar with my buddies!

First of all, I would like to make the (perhaps silly) argument that, even if we manage to maintain fatalities at the current rough run rate of 3,500-4,200 per week on average, this is still a disaster that should be cause for immense concern. In four short months, this pandemic has already cost the US more fatalities than WWI and Vietnam. And we are a long way from being safe.

I would also like to remind readers (at least those of you with a sense and perspective of history) that the US altered the planet’s geopolitical landscape following a horrific terrorist attack in 2001 that caused ~3,200 casualties: those interventions, performed at immense subsequent cost to the country (in both blood and trillions of dollars of treasure), were never questioned.

Why are we not taking this deadly pandemic as seriously, with a comprehensive strategy and a plan?

That aside, I agree that, SO FAR, fatality rates are not (yet) increasing dramatically across the entire country. However, it is important to remember a few things:

  1. As discussed here in Timmerman Report on Mar. 18, fatality increases lag ~2-4 weeks behind hospitalization increases, which themselves lag ~2-4 weeks behind increases in number of infections. And there are now at least 5 US states reporting substantial increases in hospitalizations. I am particularly concerned about Texas and Florida, since they have some very large / dense cities: as we learned (or should have) from New York (and Milan, Paris, London, and Wuhan before that…), highly populated, dense urban centers are the first and most highly affected, since it is easier for the infection to spread to the most vulnerable population segments there. We are beginning to see alarm bells ringing from hospitals in Houston, the fourth-largest city in the US behind New York, Los Angeles and Chicago.
  2. Current week-on-week growth in fatalities are actually already extremely concerning in Alabama (120% growth), Kansas (100%), South Carolina (57%) and Arizona (56%). I do hope we do not re-enact the tragedy that befell New York, this time across multiple locations across in the country, but we are heading inexorably there without any meaningful course correction. Texas has (I think) decided to stop messing with itself. As I write, Texas Gov. Greg Abbott announced closing of bars and limiting gatherings, in a further rollback of its reopening plans. So, there is hope. But: I cannot but look with regret and sadness to the fact that no lessons were learned here, from other countries and from the lives and livelihoods lost. American Exceptionalism (seen today through an “it can’t happen here” attitude) can sometimes be a very dangerous pre-existing conviction indeed, especially against a virus who only obeys an evolutionary, biological imperative and does not care what you think you know.

Now that those pesky objections are out of the way, let’s look a bit across the pond, again, to the country in Europe that was hit early and hard (yes, of course it is Italy (eyeroll).

How are they doing? Can we apply any additional lessons from there to here?

As can be seen in https://www.worldometers.info/coronavirus/country/italy/, Italy seems to have turned the corner: the number of daily new cases seems to have stabilized around 100-200 per day now, from a horrific peak of more than 6,000/day in mid-late March. The number of fatalities has also decreased to low double digit (20-40) / day from a peak of almost 1,000/day at the end of March.

Now, I do not know what you think of my native country, apart from the obvious facts that the food, the art and the people are amazing. But I do hope we did not give you the mistaken impression that we are organizational geniuses with an extremely efficient government and an obedient and compliant population, also excelling in biotech and pharma R&D. Because, and I am sorry to burst your bubble here, nothing could be further from the truth. Trust me.

However, what the country’s government did realize early on (never too soon, but soon enough) was that the pandemic’s exponential growth rate and high infectivity was the enemy. They locked down initially a few affected villages / small cities in early March, then Lombardy a few days later, and then entire country on March 9 (See Mar. 10 Timmerman Report article).

Even with that, the effects in Lombardy were catastrophic, as we all know.

One thing you might not know, is that there were very, very few cases outside of Lombardy. The lockdown basically pre-empted the spread to the rest of the country. Not fast enough to prevent more than 30,000 deaths. But it could have been a lot worse. And local, regional and national governments ALL ALIGNED in providing clear, simple, unequivocal communication to the population: Stay At Home. (See May 26 Timmerman Report about clear messaging).

There is now an entire comedy art form / meme unwittingly created by the videos of (especially southern Italian) mayors *screaming* to their constituents to take the lock down and social distancing seriously: go to this video and have a laugh. Trust me it is funnier in Italian. But they saved lives by shutting down, *at the same time*, the entire country.

Many grave, in some cases fatal, mistakes were made. Of course,  they did not know better, and human nature is what it is, sadly. Early on, elderly patients were first admitted to hospitals upon suspicion of infection and then brought back to their retirement homes. That unwittingly spread the infection in the most vulnerable demographics.

In late February and early March, industry lobbyists forced the government to wait a few additional days before imposing the lock down, costing many more lives (sound familiar?). Local government officials, in Milano and the Lombardia region, mocked openly the curfews and lockdowns early on, spreading an “insouciant” attitude (sound familiar?). Also, remdesivir was not available, hospitals were severely lacking in PPEs and other essential equipment and instruments, and so on.

This is far from over. As summer arrives, and people relax their precautions and behaviors, as families reunite after months of separation, there is a risk, even a likelihood, that the infection will regain a foothold. My mom in Italy went to the hairdresser the other day, and I almost had an apoplectic fit when I heard.

I hope we in the US avoid what is currently happening in Iran, where cases started to rise again around May 2: fatalities initially did not increase (cue the usual crowd of pundits mentioning “young people are getting infected so nothing bad is going to happen”). However, if you go to https://www.worldometers.info/coronavirus/country/iran/, you will see deaths starting to pick up again ~3 weeks following case increases. But, by starting from a low base, there is the possibility of containing a second wave.

Back to the US: how do we then look forward to the future? What is our strategy to get out of this mess? Is there a strategy??

As J.L. Gaddis discusses (extremely eloquently) in his wonderful book “On Grand Strategy”: strategy is the alignment of aspirations and capabilities. That alignment often requires mastering the arts of logistics, communication, as well as leadership.

If I, the Persian emperor, want to conquer Greece, and invade it with a massive army, I better make sure my supply lines are adequate to the task of feeding my army, and that I have navy captains that know the local waters before engaging enemy fleets (you should really read the book). Otherwise, a not-quite-united country of basically goat herders can wipe out a force 10-20x bigger.

What are our aspirations? That part *should* be easy: going back, safely, as soon as possible and with minimal loss of life, to a “normal” living environment.

What are our capabilities? Well, that part *should* also be very easy. This is, after all, the richest, strongest, most technologically advanced nation on earth. We just sent a new (reusable!) manned rocket to the International Space Station! We have the largest representation of leading biotech and pharmaceutical research, in truly incredible innovation clusters like Boston, NYC, SF, etc. Yet the US has consistently lagged on testing (see chart below).

We should be able to test, trace, isolate infected individuals, make sure our hospitals have plenty of spare capacity and equipment to contain potential surges, and have a corresponding research and manufacturing plan to both develop treatments / vaccines and ensure they can be delivered in the safest way and shortest possible delay to the greatest share of the population.

As also discussed in Gaddis’ book, achieving this alignment does have some essential, mandatory requirements: an earnest and frank assessment of capabilities needed to then achieve your objectives, and a leadership who can then execute and create new capabilities when needed.

And there’s the rub.

To wrap this up:

  1. I no longer believe the US is going to be able to test, trace and isolate its way back to “normal”, whatever that is. For one, the virus is by now endemic in pretty much every state and very likely in too many communities to be able to “contain it”. The genie is out of the bottle, cat out of the bag, horses / barn door, etc etc. You see my point. Too late for that.  
  2. The government policy of basically abandoning each individual state to its own fate has resulted in a patchwork of inconsistent (and often incoherent) measures: amongst other nefarious consequences, a chunk of the population has therefore seriously underestimated the seriousness of the pandemic. It is now exceedingly difficult to “re-educate” that population to implement healthier behaviors (masks, social distancing, etc.). I will spare any commentary on the absurdity of each state government having to basically figure out from scratch what to communicate, how to fight a pandemic, purchase PPE and diagnostic equipment, hire / consult with experienced virologists / epidemiologists in a time-sensitive crisis, build (again from scratch) a test / trace / isolate infrastructure, etc. etc. Insane does not even begin to describe it. Perhaps NY, MA, CA, WA and a few other large, knowledge-intensive and resource-rich states can do that (but why should they re-invent the wheel every time?). But the Dakotas? Wyoming? Montana? Kansas? The coronavirus task force did its first public briefing today after two months. Do they believe the virus just magically “reappeared” out of thin air? I am not sure my frustration is showing at all here?
  3. We still have a few months (at a minimum) before additional pharmaceutical interventions could show efficacy and then become available in order to make a meaningful difference on severity and fatality: we need that time and those interventions to help us “manage” while we pray for a safe and effective vaccine. We have to limit the damage until then.

So, what are we left with? Not much, without some clear leadership. But, we should try. The alternative is too hard to bear. Some extremely common-sensical suggestions below.

  1. Impose mandatory mask wearing in ALL public spaces. Impose fines for violators. Ban large (or medium-size) gatherings. You might find it shocking, but America led the world during the 1918 flu pandemic (please, do not call it “Spanish” flu, it actually started in Kansas and spread was facilitated by WWI troop deployments…) in imposing mandatory mask wearing with fines and jail terms for people not complying. Forget the debate about individual liberties etc.: your individual “liberty” to not wear a mask should stop when you are threatening the entire community’s welfare.
  2. Keep higher-risk populations as isolated as possible, with particular care for nursing homes, long-term care facilities, prisons, meatpacking plants and other highly-dense populations.
  3. Step up manufacturing of PPE and (for the love of all that is holy), sort out viral testing *at speed* and scale, and serological testing at a sufficient accuracy to make a difference. This is absolutely necessary for the months ahead (see below).
  4. Prepare for the autumn. I am not sure what the fall’s flu season will look like, but we need to be able to differentiate between different respiratory infections so that COVID-19 patients can be screened and isolated. Train an army of contact tracers properly and across the entire country. Employ / train the legions of unemployed in the service, hospitality and airline industry to provide that essential service. Make sure everybody in the country receives a pneumococcal vaccine and a flu vaccine as soon as it becomes available.

I closed my Mar. 10 article with the words: “We have no time to lose. And may the fates look upon us with mercy”.

We lost 16 weeks.

The fates, like the virus, do not seem to care.

It is up to us.

Follow Otello Stampacchia on Twitter: @OtelloVC

This article expresses the personal views and perspectives of the author. The views and perspectives expressed here do not necessarily represent the views or perspectives of Omega Fund Management, LLC or any officer, director, partner, member, manager or employee of Omega Fund Management, LLC or any of its affiliated entities.

25
Jun
2020

The Exponential Curves Re-Emerge

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25 Jun 2020

Luke Timmerman, founder & editor, Timmerman Report

The curves are telling the story.

They were flat for a while. Now they’re heading up the exponential slope again.

Texas, Arizona, Florida – and even California, which did so well for so long – are among the couple dozen states that are beginning to look up at those scary curves of new COVID-19 cases.

We still have no idea where this is truly going. The CDC said yesterday that there are probably 10 times more cases in the US than have been officially counted.

Even with pandemic math this grim, nearly four months into the outbreak, we still don’t have enough people wearing masks. Not enough people are respecting social distancing guidelines.

Too many are wallowing in cynicism. Too many are stuck in denial. Too many are blinded by ideology or hatred of the other.

We are reaping what we’ve sown – too much pollution in the information age. The conservative New York Times columnist Ross Douthat would say that’s part of a decadent society.

Responsible public officials who came of age before the infodemic seem befuddled sometimes when people don’t listen.

“We have to realize that we’re a large country that has outbreaks in different regions, different states, different cities, that have different dynamics, and different phases in which they are in,” Tony Fauci, the nation’s top infectious disease official, said as far back as Apr. 23.

After a long plateau of cases in late May and June, we are recording about 38,000 cases a day, according to the CDC (see chart below). The growth trajectory of cases the past two weeks threatens to overrun hospitals in multiple states.

This new surge in the South and West is happening when the US has already recorded 122,000 dead. About 30.6 million people were receiving unemployment checks in the first week of June – about one-fifth of the US workforce. An estimated 28 million renter households are at risk of eviction in the pandemic, according to a May report by Amherst, an investment research firm. Black people in the US, of course, face a disproportionate risk of being evicted.

People are weary of the virus. People are scared about their economic future. Many don’t know how much longer they’ll have a roof over their heads.

Given this state of affairs, it’s sometimes hard to imagine a focused, intelligent, disciplined, collective problem-solving effort to wrestle this virus to the ground and get the economy back on track. The angriest, loudest, most provocative and dishonest voices suck up most of the oxygen on the Internet, drowning out the voices rooted in facts and reason. For now, we don’t seem capable of having grown-up conversations.

Those of us who care about science have to stay steady and focused.

We can be part of the solution.

The protests in the wake of the killings of George Floyd, Armaud Arbery and Breonna Taylor have shown us that people are willing and able to march in the streets. We can demand change, and get it.

We need to keep holding elected officials’ feet to the fire to create a more humane and just and healthier world. It starts with us expecting better, of not just shrugging in resigned acceptance of cynicism and corruption.

This industry is doing its part in the fight against COVID-19. Compiling this column every week fills me with hope and wonder. Read to the bottom and you’ll see why. Every week, it’s a joy to consolidate knowledge and see the remarkably fast progress on drugs, vaccines and diagnostic tests. The money flowing into this industry is breathtaking. The sheer brilliance and energy represented by the partnerships completed each week is inspiring.

I’d like to see this renewed mission-driven industry spirit spill over into other aspects of the way this business operates. The industry can get better in how it hires, develops, and treats every human being that comes to work. We can encourage everyone to vote, and remove obstacles that get in the way of people exercising that right.

We can demand elected officials to reverse disastrous anti-immigrant policies. Instead of going all-in to block changes to the way we pay for drugs, the industry can get to work on a new system that rewards drugs for the value created for patients and the healthcare system.

A lot is happening every day, and much is positive. Let’s keep the conversation going about beating COVID-19 in the near term, about strengthening our public health defenses for the long term, and about creating a more equitable and decent world for our kids forever.

Science

  • Effect of Dexamethasone in Hospitalized Patients with COVID-19. Preliminary Report. MedRxiv. June 22. (Peter Horby et al)

Science Features

Policy & Politics

  • Rules for Clinical Trials in a Pandemic. WSJ. June 21. (Scott Gottlieb and Mark McClellan)
  • Three Recent Reversals Highlight the Challenge of COVID19 Science. The Bulwark. June 22. (David Shaywitz)
  • The US is Falling Behind Its Peers. Americans – If Not Their Leaders – Are Noticing. Washington Post. June 22. (Catherine Rampell)

Public Health

  • CDC Broadens Guidance, Covering a Wider Range of Americans Facing Severe Risk of COVID-19. STAT. June 25. (Helen Branswell)
  • We’re Pretending the Virus Is Gone. That Will Make it Worse. Washington Post. June 20. (William Hanage)

Epidemiology

Humanity

  • A Dual Degree from Oxford. A Medical Degree from Harvard. Neither Protected Me from Racism. WBUR. June 18. (Tafadzwa Muguwe)
  • Why Juneteenth Matters. NYT. June 18. (Jamelle Bouie)
  • WHO Chief Calls for Equitable Supplies of Dexamethasone for Severe COVID19 Patients. The Hindu BusinessLine. June 23. (Jyothi Datta)

Communication

  • Research Explores How Conservative Media Misinformation May Have Intensified the Severity of the Pandemic. Washington Post. June 25. (Christopher Ingraham)
  • Canaries in the Coal Mine. COVID-19 and Black Communities. Harvard Kennedy School, Shorenstein Center on Media, Politics and Public Policy. June 24. (Brandi Collins-Dexter)

Treatments

South San Francisco-based Theravance Biopharma said it dosed the first patient in a Phase II study of its lung-selective nebulized delivery form of a JAK inhibitor for hospitalized patients with COVID-19. The study, in the UK, will look at whether the drug can tamp down cytokine storms that can progress to lung damage, and ultimately help patients avoid Acute Respiratory Distress Syndrome (ARDS).  

Miami-based Ridgeback Biotherapeutics said it’s starting up a pair of Phase II trials with its novel antiviral ribonucleoside analog against SARS-CoV-2. The studies will enroll adults ages 18 and older who are PCR-positive for COVID-19 but non-hospitalized, or newly hospitalized.

Gilead said it’s gotten clearance from the FDA to move ahead with clinical development plans for an inhalable formulation of remdesivir for COVID-19, instead of just the usual intravenous form. The inhalable could be given via nebulizer outside the hospital, and at earlier stages of disease, targeted to the lungs. First patient enrollment is scheduled for August.

Cambridge, Mass.-based Evelo Biosciences said its orally available, microbiome-based therapy EDP1815 is being prepared for a randomized 469-patient Phase II/III clinical trial in the UK. The Evelo drug candidate has been tested already in psoriasis, and has shown an ability to suppress multiple inflammatory cytokines implicated in cytokine storms that have been implicated in so much suffering and death in COVID-19 patients.

Vaccines

Cambridge, Mass.-based Moderna said it formed a deal with Catalent to provide fill & finish work on its COVID-19 vaccine candidate. Catalent will be staffing up to do the fill & finish work needed for 100 million doses for the US market starting in the third quarter of 2020 (before Sept. 30). Work will be done at Catalent’s facility in Bloomington, Indiana, and the companies are looking for capacity to make hundreds of millions of more doses.

Data That Mattered

Somerville, Mass.-based Finch Therapeutics said it passed a randomized 206-patient clinical trial with a microbiome-based therapy for C. difficile infections. The company said it met the Phase II study’s main goal, delivering a cure for 74.5 percent of recurrent C. diff patients after eight weeks, compared with 61.5 percent who did that well on the standard antibiotic treatment. Finch said it’s the first time an oral microbiome therapy has passed a pivotal trial. It’s something of a boon to the field of microbiome therapeutics, which has been perceptually dragged down by the failure of Seres Therapeutics in its first pivotal study a few years ago.

Merck said its experimental 15-valent conjugate pneumococcal vaccine passed a pair of Phase III studies looking at safety and immunogenicity in adults age 50 and older, and in adults age 18 and older living with HIV.

Cambridge, Mass.-based Acceleron Pharma said it passed a 106-patient Phase II, randomized, placebo-controlled study of sotatercept as a treatment for pulmonary arterial hypertension. The drug was tested at a low and high dose, and given by subcutaneous injection every 21 days to patients already on stable background therapy. Acceleron said it was able to reduce pulmonary vascular resistance, the primary endpoint of the study, by 33.9 percent on the high dose, and 20.5 percent on the low dose. The placebo group saw a 2.1 percent reduction.

Financings

  • Cambridge, Mass.-based Relay Therapeutics, a computationally driven drug discovery company, filed an S-1 prospectus to raise as much as $200 million in an IPO. For more background, see this December 2018 TR story, and this January 2020 appearance by CEO Sanjiv Patel on The Long Run podcast.
  • Cambridge, Mass. and Montreal-based Repare Therapeutics, a synthetic lethal cancer drug developer, raised $220 million in an IPO priced at $20 a share. It traded up above $33 a share at last glance.
  • Watertown, Mass.-based Forma Therapeutics, the developer of small molecules for rare blood diseases and cancers, raised $277 million in an IPO at $20 a share. Forma shares immediately doubled in value, and traded near $49 a share yesterday.
  • San Diego-based Progenity, a molecular diagnostics company, raised $100 million in an IPO priced at $15 a share. It traded down below $11 a share in its first few days. (Readers of the Progenity IPO preview on TR from June 16 will recall this company’s unusual disclosure that it owes $49 million to settle federal and state investigations into billing irregularities.)
  • China-based Genetron Holdings, a cancer diagnostics company in China, raised $256 million in an IPO priced at $16 a share. It traded down in the $12-13 range in the following days.
  • Seattle-based Sana Biotechnology said it collected all the tranches of its initial funding round of $700 million. The company is working on allogeneic cell therapies for cancer, and is led by veterans of Juno Therapeutics (now part of BMS).
  • Cambridge, Mass.-based Editas Medicine, the gene editing company, raised $187 million in a public offering at $31.25 a share.
  • Cambridge, Mass.-based Evelo Biosciences, a microbiome-based therapeutics developer, raised $45 million in a stock offering at $3.75 a share. The financing came after Evelo announced its EDP1815 drug candidate is entering a Phase II/III clinical trial in the UK in high-risk COVID-19 patients.
  • Plano, Tex.-based Reata Pharmaceuticals secured a $350 million investment from Blackstone Life Sciences.
  • Denver-based Dispatch Health, a tech-enabled home health care provider, raised $135.8 million in growth capital, led by Optum Ventures.
  • UK-based Epidarex Capital said it raised a new fund with 102 million pounds to invest in life science startups in the UK.
  • New Haven, Conn.-based Simcha Therapeutics secured a $25 million Series A financing to further develop an IL-18 cytokine it has engineered, with directed evolution, to reverse the immunosuppressive environment that allows tumors to grow.
  • Friendswood, Texas-based Castle Biosciences, a cancer diagnostics company, raised $74 million in a public offering.
  • Cambridge, Mass.-based Magenta Therapeutics, seeking to improve stem cell therapies, raised $60 million in a public offering.
  • NantKwest, a company developing Natural Killer cell therapies for cancer, raised $80 million in a public offering.
  • Chi-Med secured $100 million in equity financing from General Atlantic.
  • Baltimore-based AsclepiX Therapeutics raised $35 million in a Series A led by Perceptive Xontogeny Venture Fund. It’s developing therapies for retinal diseases.
  • Cambridge, Mass.-based Leap Therapeutics, an immune-oncology company, raised $45 million in a stock offering.
  • Cambridge, Mass.-based Compass Therapeutics, a cancer drug developer, raised $60 million in a private placement.

Deals

Lexington, Mass.-based Translate Bio, the developer of mRNA therapies and vaccines, expanded its 2018 collaboration with Sanofi to encompass vaccine work across broader swaths of infectious disease. Sanofi is getting exclusive worldwide rights to vaccines for infectious disease built on the Translate technology. In return, Translate is getting $425 million upfront, with $300 million in cash, and the rest in the form of a stock purchase. The companies are working on a COVID-19 mRNA vaccine candidate in preclinical development, but the collaboration also includes influenza and a couple of undisclosed viral and bacterial pathogens. Just after the deal, Translate announced plans to raise $125 million in a stock offering. (For background, listen to Translate CEO Ron Renaud on The Long Run podcast, December 2018).

Gilead Sciences, seeking to continue building out its cancer portfolio, agreed to acquire a 49.9 percent ownership stake in South San Francisco-based Pionyr Immunotherapeutics for $275 million. Gilead has an option to acquire the whole company for another $315 million, and could end up paying the Pionyr shareholders $1.15 billion more in milestones if certain goals are met. Pionyr is developing preclinical technology intended to help patients who don’t currently respond to checkpoint inhibitor therapy. (CEO Steve James was a featured speaker at the San Francisco Cancer Summit that I organized last year as a fundraiser for the Fred Hutch Climb to Fight Cancer.)

Lexington, Mass. and Amsterdam-based UniQure pulled in $450 million upfront from CSL Behring as part of a deal to commercialize its gene therapy for hemophilia B.

San Francisco-based Invitae, a genetic testing company, agreed to acquire ArcherDx. The combined company will have strengths in germline testing, somatic testing, liquid biopsy, and tissue genomic profiling for cancer. ArcherDx shareholders are getting 30 million shares in Invitae, plus $325 million in upfront. Another 27 million shares could go to ArcherDx if certain goals are met, bringing the total deal value to $1.4 billion.

Tokyo-based Sosei Heptares formed an agreement with AbbVie to co-develop small molecule drugs against G-protein coupled receptors (GPCRs) implicated in inflammatory and autoimmune diseases. Sosei Heptares is eligible to collect $32 million in upfront and near-term milestones.

Cambridge, Mass.-based Yumanity Therapeutics formed a strategic alliance with Merck, in which the big drugmaker will get access to work on two pipeline programs Yumanity has for amyotrophic lateral sclerosis and frontotemporal lobar dementia. Yumanity is getting an undisclosed upfront payment and is eligible to receive milestone payments worth as much as $500 million.

Cambridge, Mass.-based Codiak Biosciences, the developer of exosome therapeutics, agreed to work with Sarepta Therapeutics on five neuromuscular targets. Codiak stands to collect $72.5 million in upfront and near-term milestone payments. (See TR coverage, June 22, 2020).

Ann Arbor, Mich.-based Esperion Therapeutics amended its collaboration in Europe with Daiichi Sankyo. Esperion will collect its $150 million milestone payment once the companies applications for its cardiovascular drugs are cleared for marketing in Europe, not when the first commercial sale occurs, as was the case in the original deal.

Morristown, NJ.-based Melinta Therapeutics, an antibiotic developer, called off its merger agreement with Tetraphase Pharmaceuticals.

New York-based Schrodinger, the computational drug discovery company, announced a couple deals. One combines the company’s physics-based software with vivid structural imaging from cryo-EM technology from Thermo Fisher Scientific. Schrodinger also said it’s now working on antiviral therapeutic discovery against COVID-19, which could be sped up thanks to a donation of significant cloud computing power from Google Cloud.

Philadelphia-based Century Therapeutics, the developer of induced pluripotent stem cell-derived allogeneic cell therapies, agreed to acquire Empirica Therapeutics – a company with a multi-omics based approach to treating glioblastoma. Financial terms weren’t disclosed. Janelle Anderson, chief strategy officer of Century, was credited with shepherding the deal. (Listen to Janelle describe Century Therapeutics’ strategy on The Long Run podcast, August 2019).

Evotec and Samsara Capital and KCK, a family office, teamed up to invest in seed company projects in a new entity called Autobahn Labs. It has an initial collaboration with UCLA. Plans are to invest as much as $5 million per company.

Personnel File

Terri Young was hired as executive vice president, chief commercial and strategy officer, at Cambridge, Mass.-based Seres Therapeutics. She was previously vice president of global commercial strategy at Sage Therapeutics.

Brent Saunders, Randy Scott and Andrew Lo joined the board of directors at Palo Alto, Calif.-based BridgeBio Pharma, a developer of treatments for genetic diseases.

Brisbane, Calif.-based Sangamo Therapeutics said Adrian Woolfson, the executive vice president of R&D, is leaving the company. Sangamo is splitting research and development into separate functions that will both report in to CEO Sandy Macrae. Jason Fontenot will be interim head of research. The company said it’s looking for a head of development.

Regulatory Action

Cambridge, Mass.-based Epizyme, a cancer drug developer, secured accelerated approval from the FDA to start marketing tazemetostat (Tazverik). It’s for patients with EZH2-mutation positive tumors, getting third-line treatment for relapsed / refractory follicular lymphoma.

Boston-based Akili Interactive secured a CE Mark to allow marketing in the European Union for its video game-based approach to treatment of attention-deficit hyperactivity disorder (ADHD). The European clearance came just days after Akili secured clearance for its first-in-class digital therapeutic from the FDA.

Newton, Mass.-based Karyopharm Therapeutics won FDA clearance to market selinexor (Xpovio) as an oral therapy for third-line treatment of relapsed or refractory diffuse large B-cell lymphoma. It’s a second indication for the drug, which was previously cleared for multiple myeloma.

22
Jun
2020

From Heart to Head, Corporations Can Step Up Against Systemic Racism 

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22 Jun 2020

Karl Simpson, CEO, Liftstream

The raw, painful emotions emanating from Minneapolis, in the aftermath of George Floyd’s killing by police, have prompted millions of people to stand up in defiance of racism and inequality.

The passionate reaction is right, and long overdue. George Floyd was just the latest in a terrible list of victims of police brutality.

What’s most important is how activists have made clear, and forced the world to listen, to the fact that police brutality is just one of many manifestations of systemic racism that infects so many aspects of the modern world.

The business community has gotten the message. The first step was decrying the grievous act of murder. But very quickly, businesses have been forced to re-think many longstanding systems that serve to perpetuate inequality in so many ways, which usually aren’t caught on cell phone video. Hiring, retention, and promotion are obvious places where companies have control, and a chance to make good on many stated commitments to creating diverse, equitable and inclusive places of work.

Finding your voice in such times can be hard. As a white man in his forties, building leadership teams and consulting on diversity for predominantly white corporate clients in the US and Europe, I am commonly perceived as part of the inequality problem. The fear of vilification for misspeaking, appearing tone-deaf, or doing something perceived as ill-timed in the moment, can be a sufficient deterrent to action.

Instead of accepting this implicit blame and keeping quiet, I have, since 2004, chosen to put my energy towards developing solutions to the problem. I’ve researched and advocated for improved racial and gender diversity at life science companies at the board level, in the C-suite, and throughout these organizations. I’ve aligned myself with policy and lawmakers and shaped cross-industry actions. Equipped with data, evidence and expertise, I have worked with our clients across the life sciences sector to put together plans, with measurable benchmarks, to introduce diversity and inclusion. 

This experience has taught me to run towards these situations, not away. I have repeatedly had to find my voice and challenge behavior intended to discriminate.  

As a white man, people often reveal to you their racist and sexist views. Whether it is a biotech CEO who plainly refuses to countenance the recruitment of Muslim immigrants, or a male VC who once suggested that “women should be hired where they’ll do the least damage” — you have to confront these attitudes.

By speaking out, I hope to use any advantage that I have to tackle the specific challenges afflicting black people and minorities in our workplaces, as well as encourage others like me to do the same.

White people need to speak up, and be specific about the changes that need to occur, and the things we can do, to create a more equitable world.

The words we use matter. When the atmosphere is this febrile, the comments need to be particularly thoughtful and sensitive, but above all, genuine. Staying silent has implications too, as silence can be deafening, particularly in the ears of those people most expecting us to say something. If you are a company leader and have nothing to say, think about the message that sends.

When events pique our emotions, they guide our actions and our language. But for these passionate words to endure, they must be anchored in intellectual rigor, and a determination to see action follow. Like in any intense situation, the best leaders know how to listen carefully, and act decisively, with poise under pressure.

Company leaders today need to become champions of change.

In tackling gender equality as that movement has gathered momentum in the past few years, men have been crucial champions. Since men hold most of the positions of power, it simply requires men to get on board if we’re going to see real change.

When my company held its first diversity conference in Boston during 2015, of the 200+ executives in the room, only around 10 delegates were men. When we came back the next year, this was nearer 33%. By 2019, men were almost half of the attendees.

This was accomplished largely because we chose to cast a forward-looking narrative that focused on working as a community to address a business problem and that we wanted men included. More widely, women have recognized that to advance their cause, they require those in power to join their fight, which means easing up on the blame and shame game.

Beyond understanding the correlation between diversity and its effects on financial performance, talent acquisition and retention; innovation, access to capital; reduced risk and so much more, men have been motivated to improve the environment for their daughters, partners and friends. Enlightened men now see this as the right thing to do and have dropped many of the legacy values that perpetuated sexism. As gender diversity has taken root, they have witnessed the many advantages besides having truly talented colleagues.

Today though, two in five biotech boards are all-male, showing there is still a long way to go.

For racial equality to achieve the same amplification in the business setting, it too must recruit champions who’ll feel able to speak out and influence. One positive signal of the recent deluge of leader’s statements is that there now appear to be many more people, of all races, who want to be actors in the change process.

A talent imperative

But as corporate leaders join the chorus of the well-intentioned, with a new resolve to level the field, there is a truth to confront.

There’s a lot of work to do.

The life sciences sector has been delinquent in introducing broad diversity and increasing the participation of black and African American people. Sure, progress has been made, particularly on gender, but this has been incremental and slow. This inertia continues to disadvantage racial and ethnic minorities, women, LGBTQ, and others. The industry is simply not including many incredible people – and that is a dereliction of leadership responsibility.

Designing for outcomes

The racial dimension of the inequality problem in life sciences is complex, and its complexity has sometimes led to unhelpful simplification. When analyzing the talent pipeline, it reveals that black and African American employees, on aggregate, occupy a very different place in the pipeline than say people of Indian or Asian desent. Dissect that further and you’ll find variations across functions too. Therefore, prescribing solutions addressing broad classifications, such as “people of color,” can be ineffectual.

Should the representation of black employees need improving, the solution must target the explicit requirements of this group.

For example, a notable issue in growing a diverse workforce is ensuring that contributor-level employees make the transition to management.

Here are a few questions to ask:

  • If black employees are fulfilling early-career roles, how does a company set up the system such that they continue to be fully represented at that next level and don’t lose out relative to their white colleagues?
  • From the moment a black employee enters the company, how is the company allocating project work that will continually stretch and challenge that employee, heightening their chance of advancing?
  • What is the organization doing to build their network and ensure they are having impact within it?
  • What decision frameworks is the company employing to ensure that black employees are delegated decision authority, and that this is not concentrated in places where they’re not represented?

Similarly, the “double jeopardy” of intersectionality demands exploration. Each organization must understand the change it wants to affect and the outcome it seeks. To do that, it must identify the particular problems affecting each racial group and use evidence-based approaches to address the representation at each level of the corporate ladder. There is a balance for leaders to strike between discussion and action.

Although, leaders would be advised not to be too contemplative.

It doesn’t require a lot of in-depth thought or committee meetings to decide to pull the plug on the Aunt Jemima brand. Or if you’re Microsoft and Amazon, you don’t need to think very hard about stopping sales of facial recognition technology to police departments. Big pharma companies, for their part, shouldn’t need a lot of convincing to re-double efforts to recruit representative populations into their clinical trials, ever mindful of the trust they need to foster with these communities.

Many valid recommendations have been in public circulation for years, and they could be swiftly implemented as a visible sign of meaningful improvement. Inaction on some obvious steps to advance racial equity in corporations – such as the board of directors defining a clear diversity policy in their governance charter or publicly stating goals and targets for diversity – is bound to attract scrutiny from those asking what’s taking so long.

Impatience is growing.

Fix the system

When a manufacturing plant has a contamination problem, or there is a logistics issue in the supply chain, businesses typically act swiftly to implement new processes and systems that rectify the problem.

But when companies see a need to change the recruiting, retention, promotion and management of the human beings that work in a business, there’s not the same urgency to act.

The academic research, the experts, and even collective wisdom have pointed out that the systems and processes used to identify, hire, develop and retain talent are producing outcomes which repeatedly and negatively impact black people, and other people representative of diversity.

For example, if you’re a college admissions department, and you know that your university says it wants a diverse student body, but it continues to use standardized tests that favor students who can pay for expensive test prep classes, and who have been raised in school systems designed to prepare them to ace the test, then why stubbornly stick to the standardized tests for evaluating applications?

This was true until recent days, when universities around the US, after years of pressure from activists, finally said it was time to get rid of the standardized tests and find other ways to evaluate promising students.

Systems like this exist everywhere in our world, often operating below the radar of most people. Yet instead of dismantling the failed systems and replacing them with others capable of delivering more balanced representation across racial and ethnic groups, companies continue to merely tweak existing structures.

Companies commonly default to redefining company values, writing policies and handbooks, or switching emphasis to talent identification. Some will put emphasis on restructuring the interview process based on a hypothetical model of fairness, or they’ll add minorities to the team of interviewers, or they’ll scrutinize the supply chain. None of these things are likely to shift the dial.

The substantive overhaul required to correct systemic faults is then declined in favor of introducing actions designed to change individual behaviors.

It is not my wish to discourage supporting individuals, because that too is part of the solution. But no amount of training, mentoring, coaching or sponsorship is going to re-balance the opportunity scale for people of color if the underlying system is unchanged.

And fixing the system does not mean fighting inequality with other kinds of inequality. The desire for accelerated progress can lead us to seductive practices, many of which eventually disadvantage other people.

If a business wants more black employees, drawing up hiring shortlists of only black candidates, or handing out promotions to only black employees, directly discriminates against and is harmful to others. While this contortion of processes may bring short-term results, it stores up considerable problems for the future, is damaging to company culture, and should be avoided.

Better Measurement

Many CEO statements about racial inequality are prefaced with some general metric about the percentage of minorities they employ. I understand why leaders do this, but they should resist. Presenting aggregated workforce composition data often belies the real situation, and creates the perception that a company is doing better on diversity and equality than it actually is.

Alternatively, CEOs should offer accurate data that show where they employ black people in the company, at what level, and in which function. Reveal data highlighting how black and African American people are moving up through the company relative to the employee base. And report on how many racial minority candidates are being interviewed, hired and rejected in recruiting processes.

Data is needed to confirm that racial minorities are included in the decision-making fabric of the company and to introduce accountability. 

The time for data transparency has unquestionably arrived. Although complicated, it can and should be done.

Legitimate Intent

When racial minorities enter a hiring process, often their lived experience is divergent from that of a comparable white candidate.

Ultimately, many minority candidates that aspire to great jobs are met with rejection, like so many times before.

This repeated rejection compounds over time and begins to infect the way minorities see the process and alters their personal actions. The sense of not belonging, of being an outsider, of being invisible, becomes a determinant of whether they continue to engage in such competition for opportunities, knowing that being their best is unlikely to change the outcome. Where race intersects with other social categorizations, then this perception of unequal treatment is even more profound.

As a remedy, it is sorely tempting to encourage more racial minorities to put their hands up and their resumes forward to compete for positions. Cramming the funnel with candidates, unless they have a legitimate and equal chance of being hired, perpetuates false hope and exacerbates their compounded perception of bias when rejected. Instead, companies must test and trial the recruitment process to make it just and fair, as well as create that vital sense of belonging. It must deliver feedback constructively and systematically, as to negate any personal discrimination.

We have reached a moment of potentially momentous change. It’s a terrible shame it took a horrific police murder on video to compel people to get off the sidelines. But there’s a clear opportunity now to enact change and tackle the pernicious racism and inequality that weakens our organizations. History fuels our skepticism, but the millions of people marching the streets, for weeks on end, in sustained opposition to this insidious malady fills me with hope.

And it is the actions of individuals, en masse, working for change; speaking out, displaying their humanity; that will lead us to an equitable future.

 

Resources:

Karl Simpson is CEO of Liftstream, an executive search and leadership consulting practice that exclusively serves clients in the life sciences industry by supporting board and executive appointments, and consulting on diversity and governance. He is also co-founder of BioDirector, a diverse international network of board directors which is improving corporate governance and diversity in the boardrooms of innovative healthcare companies. 

18
Jun
2020

Merck Wins 2 Big Approvals, a Surprise from Old ‘Dex,’ and a Digital Therapeutics First

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18 Jun 2020

Luke Timmerman, founder & editor, Timmerman Report

For 40 days, the numbers on new COVID-19 cases have been traversing along a flat, steady ridgeline.

Now it is back on the ascent.

The President may wish to do less testing to make it appear as though case numbers are coming down. But that won’t make the SARS-CoV-2 virus go away. The 7-day moving average shows new cases are surging – in Texas, Florida, Arizona, Alabama, South Carolina, North Carolina, Oklahoma – in a full 20 states.

This unsettling fact ought to make everyone around the country pay careful attention to our daily habits and future plans. We know this virus has a way of boomeranging back on localities that have done the hard work to flatten the curve.

The numbers are reflecting what many predicted in late May. States reported 27,000 new cases yesterday – the highest number since May 8, according to the COVID Tracking Project.

Our academic scientists, our government agencies, and our biopharmaceutical companies must continue to flat-out fly to develop diagnostics, drugs, vaccines, and practical guidance for us all.

Still, some truly positive things happened.

It’s a tentative result issued by press release, but researchers from the UK reported a surprising survival benefit from an old, generic corticosteroid, dexamethasone, in hospitalized patients with severe COVID-19.

That might help in the short term. But long term, the pandemic has forced everyone to re-assess where they find value and meaning and purpose in life. While sheltering at home with family — depressed and anxious and uncertain — we looked straight into the face of atrocious racial injustice. This country has never fully faced up to this original sin.

What’s different this time is that no one can look away. No one can change the channel. The pandemic created the conditions that are likely to keep the pressure on until we citizens start seeing the change we demand. People of all ages and races and genders are activated, and we can see the pressure being put on elected officials is yielding immediate results.

Corporate America’s past of forming committees, and issuing carefully worded and meaningless statements? Please. Ain’t gonna cut it this time.

We, the people, are keeping our eye on the ball.

The highest levels of government are watching the streets. The US Supreme Court did a couple things this week that everyone in the business community, and everyone in biopharma, ought to cheer. Led by conservative Chief Justice John Roberts, the court ruled in favor of LGBTQ people, and with young immigrants protected from deportation by the DACA program.

Both of these decisions are important to the nation’s competitive advantage, especially if we want to continue building on our 75-year post-World War II history as the No. 1 biomedical superpower. Holding onto that position and building on it depends on recruiting and retaining the best people in the world. Many happen to be immigrants. Many happen to be black. Many happen to be LGBTQ. We need them all, and we need to treat them all like full citizens.

I, for one, anticipate some troubling images of backlash to start flooding the information platforms this weekend. Immense energy on the campaign trail, in Tulsa, will go into venting grievances. Some will revel in taunting and triggering the libs.

Hateful hearts will produce vile words. Those vile words will come out of loud mouths without masks.

This is not the time to take the provocateur’s bait. Not the time to play the flame game. It’s a time for being aware of what’s going on, and making sure our actions are aligned with the outcomes we want to achieve.

Big, hard problems are on the table. Like terrible disparities in how our country treats African Americans in health, education, housing, employment, and criminal justice. Like whether we are serious about creating an equitable healthcare system for everyone.

Like anything really worth doing, this is going to take hard work over a long period of time.

Biotech and pharma had a chance to set things right in the last election cycle. It didn’t step up. In one November 2015 column, when Martin Shkreli made himself the biggest name in biopharma, I wrote:

Recent drug-pricing scandals are forcing the pharmaceutical industry into an identity crisis. The industry has angered every constituency—patients, doctors, hospitals, payers, politicians—through years of self-serving bad behavior. And now leaders need to ask:

Who are we? What are we really about?

Is this business all about ruthless profiteering by a bunch of amoral hedge fund artists with empty slogans about helping patients? Or does it balance its profit obligations with a larger human purpose: to apply the latest science to the reduction of human suffering, as former Merck CEO Roy Vagelos used to say?

This time, with the pandemic and a racial justice awakening, is different. We won’t go about business as usual, in large part because we can’t.

Let’s use this time of reflection to renew the social contract of biopharma. Let’s get to work on the really hard problems worth our time and attention.

Let’s show the world what this industry is really all about.

Treatments

Researchers at Oxford University in the UK delivered some surprising good news. Scientists there said that dexamethasone — the old/cheap/abundant and convenient corticosteroid anti-inflammatory medicine — was able to reduce death rates by about one-third in a randomized trial of 11,500 patients hospitalized with severe COVID-19. Results from the RECOVERY trial were most compelling in patients on ventilators, a little less compelling in patients on oxygen-only, and no benefit was seen in patients who didn’t need respiratory support. Many scientists were optimistic, although noted with caution that the results were issued by press release, not in a peer-reviewed journal. (See the Oxford statement). (NYT coverage)

Testing

  • Ginkgo Bioworks on COVID-19 Testing. ‘If We Try, We Can Win.’ CNBC. June 18. (Chrissy Farr)

Our Broken Health Care System

  • Most Coronavirus Tests Cost $100. Why Did This One Cost $2,315? NYT. June 16. (Sarah Kliff)

Communications

Features

  • Before Catching Coronavirus, Some People’s Immune Systems Already Appear Primed to Fight It. WSJ. June 12. (Jason Douglas)
  • How America’s Hospitals Survived the First Wave of Coronavirus. ProPublica. June 15. (Charles Ornstein)

Humanity

  • Health Disparities Among Black Persons in the US and Addressing Racism in Health Care. JAMA Forum. June 18. (Aaron E. Carroll)
  • Racial Bias Skews Clinical Algorithms. New England Journal of Medicine. June 17. (Darshali Vyas et al)

Science

  • Deep Mutational Scanning of SARS-CoV-2 Receptor Binding Domain Reveals Constraints on Folding and ACE2 Binding. BioRxiv. June 17. (Jesse Bloom Lab at Fred Hutch)
  • Project Baby Bear Final Report on Whole Genome Sequencing for Kids With Rare Diseases in California. Rady Children’s Hospital San Diego. June 16. (Margareta Norton)
  • Does Tweeting Improve Citations? One-Year Results from Prospective, Randomized Trial. (Answer: Yes). Annals of Thoracic Surgery. June 2020. (Jessica Luc et al)

Politics

  • There Isn’t a Second Wave. We Are Far Better Off Than the Media Report. WSJ. June 16. (Mike Pence)
  • We’re Finally Talking About Structural Racism. Republicans Are Freaking Out. Washington Post. June 18. (Paul Waldman)

Public Health

Financings

Watertown, Mass.-based C4 Therapeutics secured $170 million in financing, including $150 million in Series B equity and another $20 million in venture debt from Perceptive Advisors. The company said it is working on advancing its small-molecule protein degrading drugs to clinical proof of concept.

Medtronic collected an investment of up to $337 million from Blackstone Life Sciences to advance its diabetes pump and technology offerings for diabetes management.

UK-based Bit Bio raised an additional $41.5 million to bring its Series A financing to a close with $50 million. Rick Klausner, Bob Nelsen and Jim Tananbaum led. The company aspires to reprogram stem cells to precisely turn them into every cell type in the human body.

Foster City, Calif.-based Vaxcyte, a vaccine developer, announced its total IPO fundraising haul was $287.5 million. The IPO price on June 11 was $16. The stock closed yesterday at more than $34 a share.

Seattle-based Proprio, a computer imaging and enhanced visualization company seeking to aid surgical navigation, raised $23 million in a Series A led by DCVC.

San Diego-based Lassen Therapeutics announced it has raised a $33 million Series A financing from Frazier Healthcare Partners, Alta Partners, and Longwood Fund. It will work to develop an IL-11 directed antibody against fibrosis and cancer.

Regulatory Action

The FDA revoked its Emergency Use Authorization for chloroquine and hydroxychloroquine for COVID-19 after reviewing data that show these drugs don’t work for this indication. Even worse, the FDA said the old malaria drugs could reduce the antiviral activity of remdesivir when given in combo with that recently approved medicine for COVID-19. The US had stockpiled 63 million doses on speculation (amplified for unknown reasons by political actors) that chloroquine / hydroxychloroquine could be the real deal. Now it will have to be dispersed to patients with lupus, or to governments around the world seeking help against malaria – indications where these drugs are known to be useful.

Merck won FDA approval to market Gardasil9, the vaccine to prevent cancers from the human papillomavirus, to prevent HPV-related head and neck cancers. The vaccine has long been approved to prevent cervical cancer.

Without regard for tumor type, Merck secured FDA clearance to market pembrolizumab (Keytruda) for cancer patients with high Tumor Mutational Burden (TMB) as defined by 10 mutations or more. That determination is being made by the FoundationOne CDx companion diagnostic test, which was also approved by the FDA on the same day.

Boston-based Akili Interactive won FDA clearance for EndeavorRx, a video game that represents a first-of-its-kind “digital therapeutic” for kids ages 8-12 with attention-deficit hyperactivity disorder (ADHD). It’s been a long road, building on research from Adam Gazzaley’s lab at UCSF. See my first story on the startup in 2012.

Cambridge, Mass.-based Epizyme won FDA clearance for tazemetostat (Tazverik) as a new treatment for relapsed/refractory follicular lymphoma. It’s an EZH2 inhibitor.

Novato, Calif.-based Ultragenyx and Kyowa Hakko Kirin won FDA clearance for burosumab (Crysvita) for the treatment of tumor-induced osteomalacia (a rare disease that causes softening of the bones and muscle weakness).

Jazz Pharmaceuticals, and its Madrid-based partner PharmaMar, announced the FDA approval of lurbinectedin (Zepzelca) for small cell lung cancer. PharmaMar said it will collect a $100 million payment in connection with the FDA approval.

Data That Mattered

CRISPR Therapeutics and Vertex Pharmaceuticals presented data from the first two patients in a clinical trial of a gene-editing therapy, CTX-001, for beta-thalassemia. One has needed any blood transfusions for 15 months, while the other has been transfusion-independent for five months. Another trial for sickle-cell disease showed that the first patient – who averaged seven vaso-occlusive crises per year and five red-blood-cell packed transfusions per year prior to enrollment – has now gone nine months without any vaso-occlusive crises, no need for transfusions, and has seen hemoglobin levels rise to 11.8 grams per deciliter (pretty darn impressive, although from a single patient).

Genentech reported that risdiplam, its orally available SMN-2 splicing modifier, provided sustained improvement in motor function over a 24-month period in patients with spinal muscular atrophy Type 2 and 3. The updated data were from patients ages 2-25, from the Sunfish trial.

Genentech also said its PD-L1 inhibitor atezolizumab (Tecentriq), given in combination with Abraxane, passed a Phase III trial of patients with triple-negative breast cancer. Patients benefitted regardless of their PD-L1 expression. The primary endpoint was pathological complete response rate.   

Deals

Seattle-based Alpine Immune Sciences secured a $60 million upfront payment from AbbVie, which now obtains the option to develop and market Alpine’s CD28/ICOS costimulation dual antagonist, ALPN-101. Alpine could collect as much as another $805 million if AbbVie exercises its option and hits development and commercial milestones. Alpine will conduct a Phase II study of the drug against systemic lupus erythematosus during the option period. AbbVie said it believes the drug could have potential against other autoimmune diseases as well.

South San Francisco-based Ideaya Biosciences pocketed $100 million in upfront cash, and a $20 million equity investment, through a collaboration agreement with GSK. The two companies will further develop Ideaya’s synthetic lethal cancer drug development programs, specifically against MAT2A, Pol Theta, and Werner Helicase.

Cambridge, Mass.-based Sarepta Therapeutics obtained access to Watertown, Mass.-based Selecta Biosciences’ immune tolerance platform for use in its programs against Duchenne Muscular Dystrophy and limb girdle dystrophy. Sarepta will do research to see whether the platform helps reduce neutralizing antibody formation to the adeno-associated viral vectors it uses for its gene therapy programs. Terms weren’t disclosed.

San Diego-based Neurocrine Biosciences formed a collaboration with Takeda Pharmaceuticals. Neurocrine is paying $120 million upfront cash, plus development and commercial milestones worth up to almost another $2 billion. Neurocrine will be responsible for developing seven pipeline programs, including three clinical stage assets for schizophrenia, treatment-resistant depression and anhedonia. Takeda retains an option to 50-50 profit share, which it can decide to exercise at certain development milestones.

Cambridge, Mass.-based Magenta Therapeutics agreed to provide access to its experimental antibody-drug conjugate to Beam Therapeutics, which is seeking to evaluate the targeted ADC as a conditioning regimen for patients receiving its base-edited cell therapies.

Personnel File

Redwood City, Calif.-based Revolution Medicines added Eric T. Schmidt, the chief financial officer of Allogene Therapeutics, and Peter Svennilson, the managing partner at The Column Group, to its board of directors. Larry Lasky is stepping down from the board, and will remain a scientific advisor.

Boston-based Dewpoint Therapeutics added Olivier Brandicourt, the former CEO of Sanofi, and Jurgen Eckhardt, the SVP and head of Leaps by Bayer, to its board. (See TR coverage by Asher Mullard on Dewpoint and its membraneless organelles for drug discovery. April 2019).

Oxford Sciences Innovation said Luke Williams and Ross Hendron joined the UK-based firm as scientists in residence.

Cambridge, Mass.-based FerGene hired Ambaw Bellette as chief operating officer, Vijay Kasturi as vice president of medical affairs, and Peter Olagunju as senior vice president of technical operations. The company is working on gene therapy for bladder cancer.

Worth Watching

New BIO CEO Dr. Michelle McMurry-Heath introduced herself to members at the BIO Digital Convention in a big way. She interviewed Tony Fauci in one session, and then convened three serious thinkers — Tony Coles, Ted Love and Jeremy Levin — for a discussion on diversity, equity and inclusion. (Videos compiled here).

13
Jun
2020

A Conversation About Race: Ted Love on The Long Run

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13 Jun 2020

Today’s guest on The Long Run is Ted Love.

Ted is the president and CEO of Global Blood Therapeutics, or GBT for short. The company is based in South San Francisco. GBT is focused on sickle cell disease. Sickle cell disease affects about 100,000 people in the US, the vast majority of whom are black. About 20 million are thought to be afflicted worldwide. It’s a huge source of pain and suffering.

Ted Love, president and CEO, Global Blood Therapeutics

GBT developed the first innovative, disease-modifying drug purposely developed for this need. GBT secured FDA approval last November. It’s a significant contribution to human health and wellbeing – which is what biotech is about, at its best.  

A few months before that landmark approval, Ted was a guest on The Long Run. You can hear about his upbringing in Alabama, his career path in biotech, and quite a bit about sickle cell and GBT’s drug.

One of the things I admire about Ted is that he’s gotten himself into a position where so many important things are aligned. He’s African American. He’s a physician. He’s an experienced drug developer and company leader. He found a way to combine all of his life experience and values, with his professional skills, and apply them all toward a huge and urgent healthcare need for African Americans.

Ted is someone who thinks about science and society, and the interconnectedness of our communities.

I’m thankful to have him share some wisdom on race today. He talks about some of his personal experiences, the shift that’s occurring in the country, and how individuals and companies can make a positive difference.

This is just one conversation of many we need to have over time. I intend to bring future guests on this show to have constructive conversations about what we can do. To that end, one specific group Ted said he supports is the Equal Justice Initiative, a nonprofit based in Montgomery, Alabama. Bryan Stevenson, a prominent public interest lawyer and author of “Just Mercy” founded and leads this group.

Now, please join me and Ted Love on The Long Run.

11
Jun
2020

AstraZeneca Opens Its Digital Komono

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11 Jun 2020

David Shaywitz

AstraZeneca has emerged with a reputation as one of the industry’s most imaginative pharmas – it was named the “most innovative” global pharma company by IDEA Pharma in November 2019, and was cast as Gallant to GSK’s Goofus in a recent Financial Times piece examining their contrasting trajectories.

In this context, I was especially excited when I saw what looked to be some public discussion of their digital strategy. In an official release on Thursday, several of the company’s digital leaders offered an update on how their digital transformation is going.

As Astounding readers know, “digital transformation” is the ideology sweeping business now, offering, depending on your perspective, either an opportunity for pharma to finally avail itself of the technologies transforming most other industries across the planet, or a sumptuous buffet – a deep trough – where all manner of management and technology consultants may dine.

AstraZeneca offers up three strategic priorities, which correspond (explicitly, it turns out) to the three temporal stages of their “Digital Health R&D Journey” (evidently, iter digitalis est omnis divisa in partes tres…).

The first, or “foundational stage” focuses on transforming processes (“how we work”), the second stage (“advanced”) looks at “redefining digital health,” and the third stage (“future-readiness”) aspires to “reimagine healthcare.”

Understandably, and in parallel to Vas Narasimhan’s experience at Novartis, most of the progress so far seems to be at the level of operations and processes, using digital approaches to introduce efficiencies. They describe a tool, “Merlin” (developed, it appears, with Deloitte) that helps design clinical studies, and another tool (which seems to be Veeva’s Vault Clinical) to “replace legacy trial management systems” with a “cloud-based, single, digitized and connected platform.” (Veeva’s low-key takeover of pharma may be as impressive as Epic’s penetration into academic medical centers.)

There’s also, inevitably, a clinical trial dashboard (for some reason, pharma execs seem particularly obsessed by the size of their dashboards, which, naturally, also have pet names; AZ calls theirs Control Tower; the Novartis version is called “Nerve Live”). 

AZ also highlights digital enhancements of their clinical supply chain that have reportedly yielded significant savings of time and money.

The other two strategic pillars seem, thus far, appreciably more aspirational, although I was struck by what seems like a solid commitment to move aggressively towards “hybrid” trials, where at least some of the data are collected remotely; AZ says up to 70% of trial data in 90 trial protocols they examined could be collected this way, which is obviously easier on patients and presumably could increase enrollment and retention, and would be especially attractive in the context of COVID-19.

Less clear is how the hybrid goal will actually be realized, though it sounds like it will involve a number of partners and a number of devices, which AZ seems to be in the process of vetting.  Beyond the data collection, there’s an aspiration to improve outcomes through digital intervention — though again, beyond the assertion of partnering with “the best in the field” (think “Top. Men.” from Indiana Jones, or “Best of the best of the best. Sir!” from Men In Black), there was really no color provided.

Finally, AZ offers a nod to a future where there’s earlier detection and diagnosis of disease, patients are alerted to risks sooner, symptoms are monitored better, AI picks up on worrisome data, and technology helps patients self-manage.  Relevant top of mind association here, of course, is Steve Martin’s famous “Holiday Wish” on Saturday Night Live. [Readers, trust me, watch this.—LT]

Bottom Line

Most pharmas are now dutifully embarked on a “digital transformation journey” and AZ is no exception; to the extent their approach is especially original or innovative, such creativity is not apparent from what they’ve shared, which feels like what most leading pharmas are doing: leveraging established partners like Deloitte to improve existing processes immediately, aspiring to bring digital to clinical trials soon, and harboring gauzy hopes for more proactive care in a technology-enabled future.

On the other hand, it seems clear that pharmas in general, and AZ specifically, really are serious about bringing more digital tools and capabilities into clinical trials, for highly pragmatic reasons. Emerging companies able to demonstrate excellence in this space are likely to be highly prized.  

11
Jun
2020

Inconvenient Truths and Rays of Light

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11 Jun 2020

Luke Timmerman, founder & editor, Timmerman Report

The information world that we built sometimes has a way of distracting us.

It downplays and marginalizes what’s important.

Not this week.

Let’s start with a few timely, inconvenient truths.

As of this writing on June 11:

  • The US has 113,865 dead from COVID-19 and counting.
  • 2 million+ confirmed cases.
  • 20,000 new cases adding up every day.
  • 21 states are seeing new cases on the rise.
  • We still have no coordinated national system for testing, tracing, and isolation.
  • A heartbreaking 44 million people have filed unemployment claims in 12 weeks.
  • Our 400-year history of systemic racism means blacks are, predictably, suffering from much more health and economic pain in the pandemic than whites.
  • Our state and national leaders don’t seem focused on creating a safe vote-by-mail system in time for the November elections. Voters of color in Georgia, once again, were disenfranchised in this week’s primary election.

But Don’t Despair. There Were Rays of Light

We have done an inexcusable, terrible job as a country fighting the COVID-19 pandemic. The world’s undisputed No. 1 superpower in biomedicine should perform better than this.

I have despaired in these pages about whether we have the guts as a country to reclaim our rights to citizenship and start getting our act together.

But this week, I saw more glimmers of hope that we will.

White Americans are paying more attention to racial injustice. The protests have moved on from the chaotic and destructive early moments to a more focused and constructive set of demands. The energy has been sustained since George Floyd’s death on May 27.

Protests have been forceful, and peaceful.

Citizens — i.e. people who accept responsibility to be informed and active participants in a democracy, rather than mere passive consumers — are holding police accountable in cities around the country. They’re using cell phone cameras capturing video of injustice on an almost daily basis.

Young and old, white and black and Asian and Latinx are locking arms in solidarity against these ongoing, brutal injustices.

The country, with no live sports and entertainment to distract us from the agony all around, can’t look away. Injustice is right there staring everyone in the face.

Powerful organizations can’t escape their past actions and inactions. Everything must be re-assessed from the ground up, and not just viewed through the lens of profit and loss.

Consider the National Football League. With the President in its corner, the NFL shamefully tried to silence black players like Colin Kaepernick and Eric Reid and Malcolm Jenkins. It got upset when these African American players exercised their First Amendment rights to peacefully protest police brutality. Four years too late, the NFL admitted it was wrong.

NASCAR, another powerhouse of cultural influence, banned displays of the Confederate flag at its events. A popular driver, Bubba Wallace, went a step further. He had “Black Lives Matter” painted on his car.

The Boston Red Sox acknowledged that former outfielder Torii Hunter, an African American, was subjected during his career to racist taunts at Fenway Park. It wasn’t just one bad apple here or there. It happens regularly. In liberal New England.

Mitt Romney, Republican Senator from Utah, isn’t living in denial. He marched with protestors.

The TV show “Cops,” after a 33-year run of glamorizing police who push around the “bad boys,”  raking in tons of ad money along the way, was abruptly cancelled.

Amazon said it would no longer provide facial recognition technology to police departments, at least for the next year. Microsoft said it will end sales of facial recognition technology to police.

Our military leadership is resisting the dangerous idea of deploying active-duty troops against American citizens who protest. Police departments around the country aren’t asking for the military to help. They are banning chokeholds. They are de-militarizing. They are getting re-trained in de-escalation tactics. New York repealed its law that shielded police misconduct records from public scrutiny. Portland and Denver got rid of the police in their schools. Police budgets are being looked at with fresh eyes. Funds are being diverted to social services and mental health agencies, which have been terribly underfunded for decades. Cops aren’t supposed to be mental health officers anyway.

What if we hired a new generation of cops who were trained in community policing, and put in the work to get to know members of the community, rather than threaten them with batons and AR-15s?

What if half of police officers were women? They are just as good at law enforcement, and less violent.

We can re-think everything about law enforcement from the ground up, and a whole lot of how our world works or should work, once citizens become active participants in democracy.

Citizens are definitely getting activated.

About three-quarters of Americans now say that George Floyd’s death is a sign of a national underlying problem with systemic racism, according to a recent ABC News poll. That represents an unheard-of 30-percentage point jump from when that question was asked in late 2014 following the death of Michael Brown at the hands of police in Ferguson, Missouri.

Systemic racism isn’t just in the police department. It’s everywhere. The demands for action are spreading, and it’s about time. Close to home, you can see it in #ShutDownSTEM and #ShutDownAcademia.

Feel the frustration, feel the exhaustion from underrepresented communities. Read this essay by Jasmine Roberts at Ohio State University, titled: “White Academia: Do Better.” Then this one, “Stolen Breaths” by Rachel Hardeman and colleagues at the University of Minnesota.

John Lewis, 80, the civil rights legend who marched across the Edmund Pettus Bridge on Bloody Sunday to fight for the Voting Rights Act of 1965, is feeling that youthful energy again.

Lewis told the Washington Post this week he’s feeling “inspired.” (Lewis, by the way, has Stage 4 pancreatic cancer. He’s focused on making the most of his remaining time.)

What can biotech do? A lot of things, like a few specifics suggested by Rob Perez and Uciane Scarlett in these pages.

Then there’s the work of biotech itself. The development of diagnostics, therapeutics, and vaccines for COVID-19 is urgent and important work for all of us, but especially African Americans who are shouldering a disproportionate burden in the pandemic.

Moderna said this week that it will start a 30,000-patient Phase III study in July with its mRNA vaccine candidate with the NIH. It’s an unimaginably fast sprint from when the SARS-CoV-2 DNA sequence was made publicly available on Jan. 11.

This industry can do amazing things.

We all know this industry has tremendous capacity for good. Biotech hasn’t always exercised its muscles for good. It can choose to do so now.

Those of you who are company leaders, here’s one humble suggestion. Make Election Day a company holiday. Give your employees the time and breathing space necessary to exercise their constitutional right to vote at the local, state and national level.

Those of you with real clout – how about pushing for a national biotech industry day off for Election Day? How about leaning on all your CROs and vendors and partners that operate all around the country to take the day off for Election Day? It’s the right thing to do. Business can take the lead.

The changes that need to happen go way beyond biotech, to the fundamentals of how we organize our society, our economy, what we value, and what we don’t. What kinds of behaviors does our economy incentivize, and what behaviors aren’t incentivized?

I’m hungry for thoughtful ideas.

If you have suggestions on how to organize a more humane, a more just, and a more healthy world, let’s talk. These things are all connected.

As Rob Perez recently said, quoting “The Lorax” by Dr. Seuss:

“Unless someone like you cares a whole awful lot, nothing is going to get better. It’s not.”

luke@timmermanreport.com

 

Vaccines

Moderna said it’s on track to start a Phase III study of its mRNA vaccine candidate against COVID-19 in July. The study, in collaboration with the National Institute for Allergy and Infectious Diseases, will enroll 30,000 subjects with the 100-microgram dose – on the low range of what has been evaluated in smaller studies. The primary endpoint, according to a Moderna statement, “will be prevention of symptomatic COVID-19 disease; while key secondary endpoints include prevention of severe COVID-19 disease (as defined by the need for hospitalization) and prevention of infection by SARS-CoV-2, the virus that causes COVID-19.” The company said that it expects to be able to make 500 million to 1 billion doses per year, by 2021, in partnership with its contract manufacturer, Lonza.

Can a COVID-19 vaccine be developed in record time? Read the transcript of an NYT conversation moderated by Columbia University physician-scientist-author Sid Mukherjee.

Testing

Sunnyvale, Calif.-based Cepheid said it is developing a 4-in-1 test for SARS-CoV-2, Flu A and Flu B and RSV virus from a single sample, in time for the upcoming fall flu season. The test will be compatible with its installed base of 25,000 systems around the world, and can be conducted “in as little as 35 minutes.”  

Treatments

Speculation is out there on what Gilead Sciences is going to charge for remdesivir around the world once the initial donated supply runs out. The pharmaceutical industry has done a lot over the years to shoot itself in the foot and destroy its public trust. Approval ratings for the industry were in Big Tobacco territory prior to COVID-19. This is a chance do better. The decision will reverberate across the industry’s reputation, writes John LaMattina in Forbes.

Public Health

Science

  • Enhanced receptor binding of SARS-CoV-2 through networks of hydrogen-bonding and hydrophobic interactions. PNAS. May 27 (Yingjie Wang et al)
  • Effect of Large-Scale Anti-Contagion Policies During the Pandemic. Nature. June 8. (Solomon Hsiang et al)
  • Identifying Airborne Transmission as the Dominant Route for Spread of COVID-19. PNAS. June 11. (Renyi Zhang et al)
  • Analysis of SARS-CoV-2 Viral Load By Patient Age. MedRxiv. June 9. (Terry Jones et al)
  • COVID-19 Coagulopathy: An Evolving Story. The Lancet Hematology.

Science Features

  • Females are Still Routinely Left Out of Biomedical Research and Ignored in Data Analyses. STAT. June 9. (Elizabeth Cooney)
  • Lots of Coronavirus Antibody Therapeutics News. In the Pipeline. June 9. (Derek Lowe)
  • Monster or Machine? Our Enemy, Hidden in Plain Sight. NYT. June 2. (Alan Burdick)
  • COVID-19 Patient Gets Double Lung Transplant, Offering Hope. NYT. June 11. (Denise Grady)

Politics

  • Exceptionalism is Killing Americans. An Insular Political Culture is Failing the Test of the Pandemic. Foreign Affairs. June 8. (Jeremy Konyndyk)

Communications

  • MIT, guided by open access principles, ends Elsevier negotiations. June 11. (MIT Libraries)

Humanity

  • Quarantine Has Changed Us All. And It’s Not All Bad. Vox. June 9. (Sigal Samuel)

Deals

AbbVie agreed to make a $750 million upfront payment to Genmab for the right to collaborate with the Denmark-based company on three bispecific antibody candidates in early development, and to work together on discovery of new drugs.

Novo Nordisk agreed to acquire Corvidia Therapeutics, the developer of an IL-6 directed antibody to reduce cardiovascular disease risk in chronic kidney disease patients. The price was $725 million in upfront cash, and as much as $2.1 billion total if milestones are met.

Sherlock Biosciences, the Cambridge, Mass.-based company developing a cheap and fast CRISPR-based test to detect SARS-CoV-2 in samples, formed a large-scale manufacturing agreement with Integrated DNA Technologies of Coralville, Iowa. The test has received Emergency Use Authorization from the FDA.  

CSL Behring agreed to acquire Vitaeris, the company that took over clazakizumab, an IL-6 inhibitor originally developed by Alder Biopharmaceuticals. The drug is now in Phase III testing for chronic active antibody-mediated rejection (AMR), the leading cause of long-term rejection in kidney transplant recipients.

Some investment banker was probably bored at work, and thought it was a good idea to gin up a megamerger between AstraZeneca and Gilead Sciences, and then float the rumor in the financial press to see if it would get any traction. My guess: this idea is Dead on Arrival.

Paris-based Egle Therapeutics, a spinout from Insitut Curie, formed a collaboration with Takeda Pharmaceutical to advance drugs against targets on T regulatory cells.

New York-based Ovid Therapeutics agreed to collaborate with Wendy Chung, a prominent researcher at Columbia University, on rare neurological diseases.

Auburn, Ala.-based SiO2 Materials secured a $143 million federal contract to produce packaging materials for COVID-19 vaccines and therapies. MIT Institute Professor Bob Langer, an advisor to the company, had the lead paragraph in the press release.

UK-based Evox Therapeutics pocketed a $20 million upfront payment from Eli Lilly as part of a collaboration to develop exosome delivery technology for RNAi therapeutics.

Financings

  • Cambridge, Mass.-based Verve Therapeutics, a company working on gene editing therapies to reduce the risk of coronary heart disease, raised $63 million in a Series A2 round led by GV. The company has now raised $123 million total.
  • San Diego-based Avidity Biosciences raised $259 million in an IPO priced at $18 a share. It’s developing antibody oligonucleotide conjugate drugs.
  • Cambridge, Mass.-based Checkmate Therapeutics raised $85 million to advance its lead drug candidate, CMP-001, which it describes as “a differentiated Toll-like receptor 9 (TLR9) agonist delivered as a biologic virus-like particle utilizing a CpG-A oligonucleotide as a key component.” Longitude Capital and Novo Holdings co-led.
  • Wayne, Penn.-based NFlection Therapeutics raised a $20 million Series A round to develop a gel therapy for neurofibromatosis type 1. VenBio and F-Prime Capital participated.
  • Boston-based CereVasc, the developer of a shunt for hydrocephalus, raised $43.9 million in a Series A financing. Perceptive Xontogeny Venture Fund led.
  • Mountain View, Calif.-based DNAnexus, a cloud-based service provider that manages genomic and other biological data sets for life sciences companies, raised $100 million in financing. Perceptive Advisors and Northpond Ventures led.
  • Cambridge, Mass.-based Vedanta Biosciences, a microbiome-based drug developer, tacked on another $12 million in financing, bringing its Series C financing to $71.1 million.
  • Palo Alto, Calif.-based Autobahn Therapeutics raised a $76 million Series B to develop regenerative medicines for CNS disorders. Arch Ventures and Cowen Healthcare Investments co-led.
  • Sweden-based Calliditas Therapeutics raised $90 million in an IPO to support its work on orphan kidney diseases.
  • South San Francisco-based Applied Molecular Transport raised $154 million in an IPO to advance development of its oral therapies for inflammatory diseases.
  • Dallas-based Lantern Pharma, a cancer drug developer, raised $26 million in an IPO.
  • China-based Legend Biotech completed its IPO fundraising haul with $487 million.
  • Jazz Pharmaceuticals pulled in $850 million through a convertible debt financing.
  • New York-based C2i Genomics raised $12 million in a Series A. It says it’s “dedicated to improving cancer patient lives and outcomes with a breakthrough tumor pattern recognition approach for liquid biopsy.” Casdin Capital led.
  • Boston-based Replimune raised $65 million in a stock offering to support its work on oncolytic virus therapy.
  • San Clemente, Calif.-based Glaukos, a company focused on treatments for glaucoma and other eye diseases, raised $250 million in a convertible debt offering.
  • Boston-based Akouos, the developer of gene therapy for diseases of the ear, issued an S-1 IPO prospectus seeking to raise $100 million.
  • San Diego-based Retrophin, a rare disease drug developer, raised $100.8 million in a stock offering.
  • Boston-based PatientPing, which provides real-time notifications on patient encounters with healthcare providers, raised $60 million in a Series C financing. Andreessen Horowitz, F-Prime Capital, GV, and Transformation Capital participated.
  • South San Francisco-based Kezar Life Sciences raised $45.7 million in a stock offering for its work on autoimmune disease and cancer.
  • Rockville, Maryland-based Cerecor raised $33 million in a stock offering to support its work on rare pediatric diseases.
  • San Francisco-based Twist Bioscience, the DNA synthesis company, raised $107 million in a stock offering.
  • San Diego-based Fate Therapeutics raised $175 million in a stock offering to support its cell therapies for cancer and immune disorders.
  • San Diego-based Cue Health, a health tech company, raised $100 million in a Series C financing that included Decheng Capital, Foresite Capital, Madrone Capital Partners, Johnson & Johnson Innovation, and ACME Capital.
  • South San Francisco-based Alpha Health raised $20 million in a Series A financing to advance its platform for automation in reimbursement. A16Z led.

Personnel File

  • Denmark-based Lundbeck said it will cut 130-160 jobs.
  • South San Francisco-based ORIC Pharmaceuticals, a cancer drug developer, named Lori Kunkel to its board of directors.
  • Legend Biotech added Corazon (Corsee) Dating Sanders, Darren Ji, and Philip Yau to its board of directors.
  • Cambridge, Mass.-based Constellation Pharmaceuticals hired Jeffrey Humphrey as chief medical officer.
  • South San Francisco-based NGM Bio added Carole Ho to its board of directors.
  • Seal Beach, Calif.-based Dendreon hired Jason O’Neill as CEO.
  • Waltham, Mass.-based Affinia Therapeutics, a gene therapy company, named Elliott Sigal to its board of directors.

Regulatory Action

Gaithersburg, Maryland-based Viela Bio secured FDA approval for inebilizumab-cdon (Uplizna) for Neuromyelitis Optica Spectrum Disorder.

San Diego-based Illumina secured an FDA Emergency Use Authorization for a next-gen sequencing test to detect SARS-CoV-2 RNA in respiratory samples.

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