Your Edge In Biotech.
21
Jul
2020

The Road Less Traveled in Biotech: Abe Ceesay on The Long Run

/
/
3
/
21 Jul 2020

Today’s guest on The Long Run is Abe Ceesay.

He’s the CEO of Cambridge, Mass.-based Tiburio Therapeutics.

Abe Ceesay, CEO, Tiburio Therapeutics

The company is developing a couple of drug candidates for rare neuroendocrine tumors. It raised $31 million in a Series A financing in January 2019 from NEA, Lundbeckford Ventures, Longitude Capital, and Alexandria Real Estate Equities.

Abe is in his early 40s, and has gotten to this point as a first-time CEO through a pretty unusual journey by biotech standards. He didn’t go to medical school, or get a PhD. He didn’t really know what he wanted to do for a while after graduating from college. He learned about biotech, fixed his gaze on the amazing things happening around Kendall Square, and basically worked his tail off to get in the door as an intern at Genzyme.

Abe thrived in a series of roles at that pioneering biotech company, and that experience propelled him to where he is today.

Abe also happens to be African American. His life experience, especially his youth, is quite different from most people who end up occupying the corner office at biotech companies.

He’s thoughtful and open in this conversation. I think Abe is an inspiring person, and I’m thankful that was he willing to come on the show, and reflect a bit on how the industry can create more space for people from diverse backgrounds who don’t always get the opportunity, but who do have something substantial to contribute if given a chance.

Please join me and Abe Ceesay on The Long Run.

20
Jul
2020

Barring Foreign Talent Is An Assault on Biotech Innovation

/
/
5
/
20 Jul 2020

John Maraganore, CEO, Alnylam; immediate past chair, BIO

As a first generation American (John Maraganore) and a proud immigrant (Jeremy Levin), we’re appalled by the relentless, short-sighted assaults by this Administration on legal immigration.

The latest attempt specifically aims to limit, and potentially shut down, immigration to America of the world’s best and brightest minds.

This is precisely the time we need these bright minds.

Jeremy Levin, CEO, Ovid Therapeutics; chairman, BIO

Thankfully, in light of a suit brought by MIT and Harvard, the Administration dropped its proposal that would have prohibited international students holding F-1 visas from staying in the United States if they were taking their classes online, as most students will be doing come fall.

Many international students are in the biological sciences and in medical schools. With COVID-19 spiraling out of control here, there is no good reason to limit the entry of international students and workers. There are good reasons to welcome them and their creative problem-solving skills.

Actions that prevent the best and the brightest students, scientists and technologists from coming to America are an assault on American innovation. These corrosive attacks are coming at an increasing pace. The threat to international students came just weeks after the Administration proposed restrictions on new H1-B worker visas. Officials claimed that the impact of such actions, when combined with extended restrictions on new green cards, would bar as many as 525,000 foreign workers from the country for the remainder of the year.

These workers are needed to do critically valuable work, including helping our country better respond to COVID-19.

These anti-immigrant directives, one after another, are like waves striking a shore; they relentlessly erode the competitiveness of many sectors dependent on driving innovation, including America’s biotechnology sector.

For decades, the U.S. biotech industry was envied around the world for its success in attracting brilliant minds from abroad who sought to advance their education and careers here. The formula for success is rather simple. The generous support of US taxpayers for the National Institutes of Health, the farsighted establishment of excellent research institutions that compete for those federal grants, and a dynamic entrepreneurial economy that translates scientific discoveries into medicines are all part of what have combined to make the US the world leader in biomedicine.

All of it begins with people.

The people drawn to be part of this amazing enterprise as young students – immigrants who came here, began to fulfill their career potential, settled down and started families here – they are the ones who helped make our country the most powerful producer of novel medicines, vaccines, diagnostics and innovations in environmental, industrial and agricultural biotechnology.

Just over half of the 69,000 biomedical researchers in the United States are foreign-born. Of the Nobel Prizes in medicine awarded between 1960 and 2019, nearly half were awarded to immigrants who came to the United States to study and work. International students represent over 20 percent of all STEM degrees at American universities and 44 percent of PhDs.

Many of these graduates gain skills here in the US and then go home to save lives and contribute in their own countries. But the majority choose to stay here: The National Science Foundation reported that nearly three out of four foreign doctorate recipients were still in the United States 10 years after receiving their degrees.

CEOs born outside the U.S. now lead some of the most important biotechnology companies racing to find treatment and vaccines for COVID-19. Research suggests that immigrants are overrepresented compared to the general population as founders of biotech firms, and are more likely to start companies focused on human therapeutics.

Raising barriers now against inventors and scientists places obstacles in front of what our industry can accomplish – and make no mistake, our industry is key to restoring normalcy through new treatments, prophylaxis and vaccines for COVID-19.

The virtual “Go Away” sign we’ve posted in the form of immigration restrictions means scientific researchers, biomedical entrepreneurs, IT experts, doctors and nurses will find someplace else to study and then contribute to the nation that educated them.

We cannot afford to drive them away. Our competitive advantage as a country rests in large part on our ability to continue to attract the best and brightest immigrants.

Diverse perspectives enrich problem solving and lead to scientific breakthroughs. Every time we further restrict immigration or turn away foreign students, we put America and Americans at risk.  

Instead, we need to welcome and encourage the best and the brightest to come to the USA.  This is a great nation and with them we will retain and enhance our leadership.

Over the past decade, eight top pharmaceutical companies alone have received H-1B approvals for over 3,300 scientists. We’d like to double that, not reduce it. Rather than putting hurdles in front of foreign students, we’d like to welcome them with grants and loans to help them pay for the cost of American higher education.

Rather than giving in to short-sighted policies, we’d like to build upon America’s remarkable scientific achievements and vision of a nation that welcomes immigrants to our shores.

In his final speech as President, Ronald Reagan issued a warning:

“If we ever close the door to new Americans, our leadership in the world would soon be lost.”

It isn’t only the future prosperity of our nation that is at stake. It is our lives, the lives of our children and importantly America’s leadership of the world.

John Maraganore is the CEO of Alnylam Pharmaceuticals and immediate past chair of BIO; Jeremy Levin is the CEO of Ovid Therapeutics and the chairman of BIO.

20
Jul
2020

Clinical Trials: High-Value Attack Surface For Pharmatech Entrepreneurs

/
/
0
/
20 Jul 2020

David Shaywitz

There’s an emerging sense among early stage investors that there are profound opportunities at the intersection of healthcare and technology, and no shortage of white papers from consultants and venture groups addressing this topic.

Consultant white papers tend to be focused on the inevitability of “digital transformation,” emphasize the $X billion dollar opportunity, and argue that if large organizations don’t want to get further behind their peers, these are the steps they need to take, right now.  

Basically: carrot, stick, call-to-action.

VC white papers in this space are often written by tech investors seeking to take their talents to the giant pool of money they assume awaits them in healthcare. Having seen the impact of emerging technologies on other industries, they are keen to coax benighted healthcare services and biopharmaceutical companies into a brilliant, tech-enabled future. 

These vision documents typically reveal a sophisticated understanding of digital technologies, but a generalized, somewhat broad-brush, somewhat naïve, somewhat condescending view of the industry they’re proposing to either serve or disrupt (ideally one, then the other).

Enticed by what many see as a huge greenfield opportunity, more and more tech VCs seem to be taking a serious run at healthtech, as manifest in a series of dedicated investments.  

Most life-science VC firms, on the other hand, seem content, as one leading Boston-based life-science VC partner told me, “to stick close to our knitting.”

In part, this may reflect the remarkable contemporary explosion of life-science innovation, largely independent of digital/data technologies. Given the range of approaches now viewed as viable involving cell therapies, gene therapies, and “multi-specific” drugs, I can appreciate (and have also seen, first-hand) how many life-science investors feel they have their hands full just sorting through this embarrassment of intellectual riches.

Even so, some venture investors with established health credibility clearly are embracing the pharma/tech interface. 

By far, the most compelling expression of this I’ve encountered so far was a recent white paper from Bessemer Venture Partners, based in Boston and California. (Disclosure: I have no relationship with the group.)

One of the oldest venture firms around, and known for their arrestingly candid anti-portfolio (missed opportunities), Bessemer has historically pursued investments in both technology and health, including both healthcare services and life sciences. Recently, at least, their focus seems to be on the former — but I may be biased by the entrepreneurs featured on “A Healthy Dose,” a fantastic podcast co-hosted by Bessemer partner Stephen Kraus and focused on companies at the interface of healthcare services and technology.  

The recent white paper reveals an insightful view (which is to say, one with which I largely agree) of the promising, emerging interface between tech and pharma.

The whole piece is worth a read, but there are a few highlights that seem particularly noteworthy.

Their central thesis is that the “greatest entrepreneurial opportunities live across the clinical trials value chain.” They acknowledge the activity in other areas (such as “drug discovery engines” — where so much of the AI-in-pharma buzz seems to reside — and digital therapeutics – think of Akili’s EndeavorRX, described by the FDA (the FDA!) as “the first game-based digital therapeutic to improve attention function in children with ADHD.” 

In identifying clinical trials as an especially promising area, Bessemer echoes the thinking of pharma leaders like J&J head of data science Najat Khan and others, who consistently emphasize the outsized importance of finding ways to make clinical trials faster, better, and ultimately cheaper using technology. 

The Bessemer team also clearly recognizes some of the key adoption hurdles emerging technologies face in pharma. These include both the general challenges of introducing change (overcoming institutional inertia, or perhaps, more accurately, lack of inertia) as well as the more specific challenges of bringing novel digital clinical trial tools and approaches into a highly regulated environment. Uncertainty around FDA acceptance of these approaches, the authors suggest, remains among the most significant hurdles.

Within clinical trials, the Bessemer team sees five somewhat distinct areas of opportunity:

  1. Decentralized clinical trials
  2. Patient recruitment
  3. Remote patient monitoring
  4. Virtual control arms and real-world evidence platforms
  5. Supply chain optimization

While these represented areas of interest pre-COVID-19, the pandemic has clearly thrown into sharp relief both the value and need for the intensification of investment in these areas.

In their analysis, Bessemer astutely identifies key distinctions and value drivers. For example, within decentralized trials, they wisely distinguish between approaches that basically enable trials at home (like Science37), approaches that emphasize the increased inclusion of community doctors to “diversify the pool of principal investigators” (i.e. expand beyond typical academic honchos from leading centers), and platforms that seek to integrate existing silos. 

I also applaud their recognition of the central importance of patient recruitment – a central preoccupation of nearly every single person involved in clinical drug development in biopharma. This is likely to be a point of increasing emphasis as companies explicitly recognize the need to diversify clinical trials to enroll people who historically been underrepresented in the research enterprise.

Bessemer also appreciates that the ubiquity of consumer digital devices doesn’t mean the data generated by these wearables are suitable for use in clinical trials – often, they are not of high enough consistency or quality to be considered “regulatory grade.” One interesting opportunity suggested by Bessemer involves developing regulatory-grade tools on top of these devices.

Not surprisingly, I was especially interested in the discussion of real world evidence, and again, the Bessemer team seemed to capture so much of the nuance. 

For example, they distinguish between “traditional” (as much as anything in this fairly new market segment can be considered “traditional”) uses of real-world data to support so-called HEOR (health economics and outcomes research) activities, generally related to reimbursement, and emerging uses. 

Of particular interest: the use of virtual/synthetic control arms, which under some circumstances can help support regulatory approval; reportedly, it was this capability that prompted Roche’s $2 billion acquisition of Flatiron Health. 

Bessemer also notes that many startups are concentrating (at least initially) on oncology data, while some are emphasizing other areas, like ophthalmology (Verana), rare disease (RDMD), neurological illness (Blackfynn), and mental health (Holomusk).  Even here, some focus on extracting value from existing data sources, while others are trying to create “novel and differentiated data sets.”

Finally, Bessemer highlights the opportunities in “supply chain optimization,” and in particular, the need to “connect various stakeholders to improve upon manufacturing execution systems.” 

Here, my improvised reaction was “yes, and….” As we’ve repeatedly heard from Novartis and others, there are huge opportunities to drive unsexy but critically important operational efficiencies throughout pharma, and tools that can catalyze this will be critically important.

Bessemer also highlighted several subtle strategic points that were especially insightful. One example: emphasizing the value of close collaboration with the FDA, not only in seeking specific approval, but, at a deeper level, in helping the agency evolve its policy, as it seeks to define where it needs to go in the future. 

This seems exactly right; agency leaders including former Commissioner Scott Gottlieb and current Deputy Director Amy Abernethy have explicitly recognized the rapid evolution of this area, and have acknowledged the need to find a way to incorporate the opportunities afforded by new technology while remaining laser-focused on the FDA’s underlying commitment to ensuring public safety. By engaging in this policy discovery process, entrepreneurs can support their own companies while also helping the agency achieve this shared long-term goal.

One area that I might have explicitly emphasized as well is the need to similarly engage with biopharma partners; successful pharmatech (as Bessemer calls this space – I like the term) entrepreneurs will appreciate the need, especially initially, to deeply engage with and learn from pharma partners, so the technology the startup is developing is aimed squarely at a critical problem the pharma company faces. 

Companies skilled at enterprise sales (Palantir comes to mind) are especially good at burrowing in really intensively, to surface the most suitable problems to effectively address. 

My advice to pharmatech entrepreneurs: 

Startups afforded the opportunity to work with pharma partners would do well to use their time searching for and constantly refining what they could be doing, not just pitching and pushing what they’re already doing.  

At the same time – and this is something Bessemer explicitly emphasizes, in the context of platform-as-a-service offerings, and may be true more generally – entrepreneurs must balance the ability to deliver highly bespoke solutions with the goal of developing “scalable platforms that can be deployed quickly and generate predictable recurring revenue.” 

Successful examples of this, I’d argue, include Veeva in biopharma, and Epic in healthcare. The traction of Epic, in particular, highlights the value of even highly-customized solutions, provided they are viewed (at least by those paying for them, and hopefully — though perhaps not in Epic’s case — by those using them) as delivering exceptional value to the client as well.

Bottom Line

There are tremendous opportunities in pharmatech for entrepreneurs who understand not only the potential of emerging technologies but also the business needs – and organizational dynamics – of contemporary biopharma organizations. The almost unimaginably high costs and exceptional complexity of clinical drug development represents an attractive, high-value attack surface, where the utility of effective solutions can be rapidly, palpably appreciated.

16
Jul
2020

Standing With Fauci, Positive Moderna Vaccine Data, and Blueprint’s Megadeal

/
/
2
/
16 Jul 2020

Luke Timmerman, founder & editor, Timmerman Report

Last week in these pages, I wrote a full-throated defense of Tony Fauci.

A few days later, the White House sadly started doing what it so often does. It embarked on a dirty tricks smear campaign against someone who speaks inconvenient truth to the public.

Peter Navarro, who doesn’t know what he’s talking about when it comes to public health or epidemiology or virology, published a rather unconvincing 269-word hit piece against Dr. Fauci in USA Today.

This scurrilous attack backfired, as predicted. I continue to stand in defense of Dr. Fauci, and continue to stand in defense of science itself as the best method we have for understanding the world.

On this, we cannot yield.

We are the world’s No. 1 biomedical superpower, thanks to decades of public-spirited investments that people of both parties have supported since the end of World War II. Now we are the absolute worst in the world in caring for our citizens and protecting our country from the COVID-19 scourge. It’s July 17 and we still have no national testing strategy.

We’re racking up 75,000 cases a day, and the numbers keep going in the wrong direction.

We are now starting to see refrigerated trucks parked outside hospitals in hotspots of Texas and Arizona, to keep the dead bodies from decomposing as they stack up faster than the funeral industry can handle. It’s time to place bulk orders of body bags.

It didn’t have to be this way, more than 4.5 months after COVID-19 officially arrived on US soil. We didn’t have to suffer this badly.

This catastrophe has nothing to do with our scientific abilities, and everything to do with our divisions, our cynicism, our polluted information ecosystem, and our dark political moment.

The only choice is for people to stay vigilant. Masks, distancing, and hand-washing are what we have to reduce the toll of suffering and death. Remdesivir may be helpful for some in the hospital, dexamethasone looks to be quite encouraging for severe hospitalized patients, and therapeutic antibodies and vaccines look promising.

There’s a path out of this mess, if we can muster the patience and empathy for our fellow citizens who have given in to despair. How else can you explain people defending the Administration as “doing the best it can” after reading this chilling piece by Gov. Larry Hogan of Maryland, a Republican?   

Our country can do much, much better. We will.

Dr. Fauci is tough as nails. He has no office to run for. He will not be distracted. He’ll keep his eye on what matters – real-time science-based advice that saves lives.

Crucially, in America, civil servants like him can’t be fired by some political hack.

He’s not going anywhere. He’s standing firm.

So must we.

Vaccines

Cambridge, Mass.-based Moderna, the developer of the mRNA vaccine candidate for COVID-19, said it passed Phase I with a safe vaccine candidate. All 45 volunteers developed neutralizing antibodies against the SARS-CoV-2 virus. The mean titers – the average concentration of these important antibodies in the blood – was higher than what’s typically seen in convalescent plasma from recovering COVID-19 patients. This detailed Phase I report – much more clear than the premature company press release from May 18 — was published in the New England Journal of Medicine. Based on the findings, Moderna is moving ahead with Phase III development, with the 100-microgram dose. The still-early findings can now be compared roughly against the Pfizer / BioNTech vaccine candidate. Pfizer CEO Albert Bourla, in an interview with TIME magazine, repeated his bullish belief in his company’s vaccine program.

The labs, test sites, and recruiting infrastructure for HIV vaccine trials represent a massive public investment in the US since the 1980s. Now, a huge effort has gone into turning this aircraft carrier in the direction it must go – toward COVID-19 vaccine studies that can enroll tens of thousands of subjects at the drop of a hat. Read the Washington Post article on this effort spearheaded by the NIH. I will be interviewing Larry Corey, the principal investigator of the HIV Vaccine Trials Network at Fred Hutch and a key architect of the COVID-19 vaccine trial initiative, today (July 17) at the Life Science Innovation Northwest virtual conference.

The Oxford University team, partnered with AstraZeneca, tells The Guardian it hopes to move ahead with the controversial decision to run human challenge studies. For the unfamiliar, this is a study where subjects get the experimental vaccine, and then get directly exposed to the SARS-CoV-2 virus to see if the vaccine offers direct protection from getting sick. Researchers have generally shied away from this design, as there’s a chance of someone becoming deathly ill from the virus, with little in the therapeutic toolkit to rescue them in that event. Young people perceived to be at lower risk will be the ones enrolling. If the gamble pays off, it could give strong evidence of effectiveness in a short study and with fewer people necessary for statistical power.

Treatments

San Diego-based Equillium said its partner in India, Biocon, ran a study that showed hospitalized patients with ARDS from COVID-19 had a significantly better rate of survival in a small study of 20 patients on itolizumab, compared with 10 patients randomly assigned to best supportive care. The drug is thought to work against cytokine storms, by inhibiting the activity and trafficking of pathogenic T cells that release pro-inflammatory cytokines. The drug is also being tested for uncontrolled asthma and lupus nephritis.

Gilead issued a press release with a retrospective – not a gold-standard prospective, randomized, controlled study — which suggested remdesivir improves survival rates for patients with severe COVID-19.

Hydroxychloroquine didn’t work for hospitalized COVID-19 patients, according to the investigators in the UK on the RECOVERY trial. Separately, researchers in Spain reported it didn’t help people with mild cases.

Politics

Public Health

  • CDC Calls on Americans to Wear Masks to Prevent COVID-19 Spread. July 14. (CDC Statement)

Features

  • This Startup Might Finally Cure Sickle Cell After a Century of Racist Neglect. Forbes. July 10. (Katie Jennings)
  • Tony Fauci: We Are Living in the Perfect Storm. Financial Times. July 10. (Hannah Kuchler)
  • Some Say We’re Doomed. But Science and Public Spending Have Saved Us from Worse Pandemics. NYT. July 15. (Donald McNeil Jr.)
  • How a Struggling Company Won a $1.6 Billion Coronavirus Vaccine Contract. NYT. (Katie Thomas and Megan Twohey)
  • A Second Coronavirus Death Surge is Coming. The Atlantic. July 15. (Alexis Madrigal)
  • What’s Ailing an Amazon Health Venture? The Information. July 16. (Paris Martineau)

The Worst of Times, and Best of Times (for some)

  • The Record-Breaking Funding Tsunami of 1H2020. LifeSciVC. July 15. (Bruce Booth)
  • UnitedHealth Shatters Quarterly Profit Record with $6.6 Billion. Axios. July 16. (Bob Herman)

Science

  • Rapid Isolation and Profiling of a Diverse Panel of Human Monoclonal Antibodies Targeting the SARS-CoV-2 Spike Protein. Nature Medicine. July 10. (Seth Zost et al)
  • Reconstruction of Full Transmission Dynamics of COVID-19 in Wuhan, China. Nature. July 10. (Xingjie Hao et al)
  • SARS-CoV-2 Specific T-cell Immunity in Cases of COVID-19 and SARS and Uninfected Controls. Nature. July 15. (Nina Le Bert et al)
  • Evaluation of 6 Commercial Mid to High Volume Antibody and 6 Point of Care Lateral Flow Assays for Detection of SARS-CoV-2 Antibodies. Journal of Clinical Microbiology. July 14. (Carmen Charlton et al)

Patient Access

  • From Houston to Miami, Hospitals Running Short of Remdesivir for COVID-19 Patients. STAT. July 10. (Eric Boodman)

Schools

  • How to Reopen Schools. What the Science and Other Countries Teach Us. NYT. July 11. (Pam Belluck et al)

Financings

Cambridge, Mass.-based Relay Therapeutics raised $400 million in an IPO priced at $20 a share. The computational drug discovery company boomed on first-day trading to close at $35.05 a share. (Listen to CEO Sanjiv Patel on The Long Run podcast, Jan. 2020, and TR coverage from December 2018).

South San Francisco-based Nkarta Therapeutics, the developer of engineered Natural Killer cell therapies for cancer, raised $252 million in an IPO at $18 a share. It closed yesterday at $36.35 a share – a $1.1 billion valuation. (See Nkarta in Stacy Lawrence’s TR article from May on how engineering techniques from CAR-T are being brought to other cell therapies).

San Diego-based Poseida Therapeutics raised $224 million in an IPO at $16 a share. The company is working on genetic engineering for cell and gene therapies.

Waltham, Mass.-based Adagio Therapeutics was founded with $50 million in a Series A financing. It’s a spinout from Adimab, the antibody discovery shop founded by Tillman Gerngross. Adagio is turning its antibody discovery expertise toward neutralizing antibodies against SARS-CoV-2, SARS-CoV-1, and other related bat coronaviruses that virologists are watching.

Philadelphia-based Imvax raised $112 million in a Series C financing to advance its personalized neoantigen based therapy for glioblastoma and other solid tumors.

Deals

Cambridge, Mass.-based Dewpoint Therapeutics, the company developing biomolecular condensates for drug discovery, formed a collaboration with Merck to work on a new treatment approach to HIV. (See TR profile of Dewpoint’s “membraneless organelles” by Asher Mullard, April 2019).

Cambridge, Mass.-based Blueprint Medicines struck a partnership with Genentech to develop and market pralsetinib for patients with RET-altered cancers. Blueprint is getting $675 million in upfront cash, $100 million upfront equity investment, and retains 50-50 commercial rights to US profits.

Personnel File

Cambridge, Mass.-based Scholar Rock said Tony Kingsley is replacing Nagesh Mahanthappa as CEO. Nagesh has been CEO since 2012, and took the company public among other achievements. Kingsley was previously CEO of Taris Bio.

C4 Therapeutics, a protein degradation drug discovery company, hired William McKee and Jolie Siegel as chief financial officer and chief legal officer, respectively.

Arkuda Therapeutics added Pascale Witz to its board of directors.

Ribon Therapeutics named Jodie Morrison as chair of its board of directors.

Racial Equity

MassBio, the trade group in Cambridge, Mass. led by CEO Robert Coughlin, issued an Open Letter to executives, outlining specific things the industry pledges to do to fight back against the centuries of injustice against African Americans in this country. See the letter, and the many prominent people who have signed it.

Some people apparently don’t think white privilege exists. They might want to read this piece on Professionalism 101 for Black Physicians, by Duaa AbdelHameid in the New England Journal of Medicine.

Ken Frazier, CEO of Merck, had some strong words for America’s power elite in the wake of George Floyd’s killing. But his own son has had some barbed comments about whether it’s all just talk. Read Ken’s thoughts about this moment of reckoning in Harvard Business Review. See excerpt below tweeted by Meg Tirrell of CNBC.

15
Jul
2020

Do We Need Models Anymore?

/
/
0
/
15 Jul 2020

Ruth Etzioni, Full Member, Division of Public Health Sciences, Fred Hutch Cancer Center

Long ago, in the early days of the pandemic, models were everywhere in the news.

As our lives were upended and everything became uncertain, models were there to provide some predictability in the face of the unknown.

Never mind that predictions varied wildly – between models, and even within the same model at different time points. The models agreed that this was going to be bad (though at the time it was hard to believe).

They scared us, and we listened.

This is a story about models and how they help guide us as we navigate the coronavirus crisis. But it is also about guidance itself – and where to look for it.

The early models that predicted the course of the pandemic were almost uniformly epidemiologic or SEIR (Susceptible-Exposed-Infected-Recovered) compartmental models.

SEIR compartmental models envision disease as progressing through the SEIR phases and they keep track of how many people are in each phase at a given time. By using data about how long it takes to become infectious after exposure, and then how long it takes to show symptoms and making a few other assumptions, they estimate R0, the number of people a person with the virus infects, and then extrapolate into the future on the basis of this number.  An effective R0 below one means the epidemic is shrinking rather than growing. A key goal of public health is to bring the R0 below this threshold number.

In Seattle, where I live, an SEIR compartmental model was developed by the Institute for Disease Modeling.  The IDM is a research institute within the Bill & Melinda Gates Foundation, but is distinct from the Institute for Health Metrics and Evaluation at the University of Washington.

The Institute for Disease Modeling showed that the effective R0 had been reduced from around 3 in February — an alarming sign of a fast-spreading epidemic — to a much more manageable R0 of around 0.6 on April 15.

At that point in mid-April, with states under various stay-at-home orders, the talk was all about re-opening. We were banding together to flatten the curve, and we were making progress. People wanted to know: When would it be safe to emerge from lockdown, and go back to something more normal? 

Here, models became useful too. With their compartmental model, the IDM modelers could project how the infection’s trajectory would change if activity and contact resumed at different levels and dates. One projection might assume reopening beginning on May 15, another might assume Memorial Day weekend, and so on. Different levels of activity could be captured by setting the effective R0 to the value estimated at different times in the past.

The IDM models from that decisive moment in mid-April made it clear that re-opening before May 15 would not be advisable. Re-opening at a later date might be OK so long as activities of daily life and the number of human contacts people have each day or week did not increase to pre-pandemic normal levels.

What increases in activity were sustainable and what could we do to keep a lid on R0? Could we re-open restaurants and bars? What size gatherings could be allowed? How about schools?

More complicated questions such as these call for a different type of model.

Agent-based models are more realistic models that simulate individuals within entire populations, interacting in home, work, and community settings. These models are driven by huge databases that describe population mobility and contact patterns, often gathered from GPS-enabled smartphone devices. With this information, modelers can tweak activity and contact in ways that are much more detailed than the SEIR models.

In principle, agent-based models can overcome a key deficiency of compartmental models – what we refer to as their mass action nature. Mass action means exactly that – compartmental models generally do not capture the heterogeneity in population contact and behavior – the superspreading events like choir practices, meat packing plants, long-term care facilities and large parties. They most often smooth everything out to one average rate of transmission. In principle, agent-based models can do better by zeroing in more clearly on the links between our behaviors and viral spread.

Agent-based models are rare because they are so data- and labor intensive to build. The IDM’s COVASIM is an agent-based model that has been deployed to explore questions about how much contact tracing might be needed to keep the lid on things in King County, home of Seattle and about 2.2 million people in Western Washington. COVASIM is now being harnessed to address school reopenings.

One thing is already clear: school reopenings must be considered in the context of the ambient level of infection in the community. If the virus is not firmly under control in the surrounding community — with R0 confidently driven down to a safe level — we can’t even begin to think about reopening schools.

But there are many things that agent-based models can’t do. They don’t have a detailed map of the land; they don’t capture all the meat-packing plants, long-term care facilities or fraternity houses that are potential hotspots. They don’t tell us whether we should open restaurants at 25% or 50% capacity or at all. They don’t tell us about behavior in bars change as the night goes on. They don’t provide some of this fine-grained detail down at the local level, complete with straight lines between cause and effect, that many officials would like to have at their fingertips when making policy decisions.

This is where I pause and ask myself: Do we really need models?

At an individual level, my take is – no, not like we did in the early days of the outbreak. We don’t need models to make the decisions that will help to keep us safe and keep infections in our community under control. There are basically two words here for those who can, supported by tons of virology data, epidemiologic data, and stories from around the world: NO GATHERING.

That means no getting together with others outside of your household for any length of time without facemasks and without distance. Every online search for “COVID outbreak at _,” – fill in the blank – church service, choir practice, extended family gathering, wedding, funeral, restaurant or bars, will turn up tons of stories. Try it.

We know what causes the virus to spread – being indoors in close contact with people over a sustained period of time. We need to avoid these opportunities to get sick or make others sick. And we need to find ways to protect those who can’t avoid them: our essential employees, our food processing workers, our supermarket clerks, our healthcare teams including their non-medical support staff, our undertakers, our dentists and dental hygienists, and our bus drivers. It’s a no-brainer. We don’t need models. The global experience is our guide at this point, more than four months after we became aware of the COVID-19 in the US.

But at a policy level, models are still important despite their limitations.

Without models, we end up with policies that move too fast and are guaranteed to increase the effective R0 way beyond sustainable levels. Reopening policies that permit gathering in restaurants, bars and religious services also send a signal that we are out of the woods, and can give people a false sense of security to organize their own large private events and get togethers that would only add to the danger.

With models, we can hope to develop evidence to support policies that may be unpopular, such as mandating face masks indoors, closing bars, or disallowing religious services. We can project how many lives a statewide mask mandate might save. We can quantify the size of gatherings that can be sustained, rather than get by on guesswork. We can zero in on the ambient effective R0 that will allow schools to reopen and work towards achieving it and sustaining it.

In the end, we do need models. But we also have enough data in hand to know what to do. We must stop looking for an authority and take responsibility. If we don’t, en masse, then we don’t need models to tell us it’s going to get a whole lot worse in the coming weeks and months.

13
Jul
2020

Playing the Long Game for Antibiotic R&D

/
/
1
/
13 Jul 2020

Ankit Mahadevia, CEO, Spero Therapeutics

This week’s unveiling of the AMR Action Fund, a $1 billion public/private consortium anchored by 23 pharmaceutical companies to support the development and commercialization of antibiotics, is a welcome development in the fight against antimicrobial resistant infections.  

The money is important, but it was very encouraging to see the leadership of major pharmaceutical companies — Pfizer, Merck, and Eli Lilly, as examples among them — personally devoting their time and attention at an event shining the spotlight on infectious disease research. Increasing long-term commitment to the antibiotic business in a meaningful way starts with a renewed, full-throated endorsement from the corporate top.

This effort, if executed well, has the potential to accelerate the scope and scale of research and development that is critical to a long-term strategy against bacterial threats. A $1B investment is meaningful. Big Pharma and biotech can further this mission by supporting academic labs and early stage companies with creative ideas to cast a wider net, and support these projects for the long-term time horizons that are required.

We can also advocate together for a sustainable reimbursement solution so that antibiotic developers know they have a chance at being adequately rewarded for the risks they take for a wider range of applications than is currently feasible.

Taking a long-term view, here are a few humble thoughts on how best to apply this new momentum in service of a robust ecosystem:  

Continue to focus on sustainable, pragmatic approaches

The focus for antibacterial drug developers has to be on sustainable pipeline investments. While $1B is a lot of money, the late stage programs that this fund may support will need to stand on their own feet for us to get to where we want to be as an ecosystem.

Further, a scattered collection of small-scale bets that support work for a year or two will not be enough. We have to build viable businesses — i.e. companies that a range of investors see a reason to invest in for many years — as a starting point. It’s not enough to wait for Congress or private insurers or healthcare provider networks to create new rules for the road, so we can have a viable antibiotic R&D business model. 

I wrote at length here on Timmerman Report in April about the hallmarks of sustainable pipelines for this strategically important area of the biotech industry:

For the time being with the system we have, it’s our responsibility as antibiotic developers to do the following:

  1. Prioritize medicines that focus on diseases not addressed by competing generic or branded medicines,  
  2. Emphasize the medicines that can help the most people today and
  3. In the US, pursue reimbursement at least in part outside of the hospital fixed diagnosis-related group (DRG) payment system — under the current system, this means at least some outpatient focus for the pipeline.

Further, we should focus on developing our treatments with real urgency, and not allow ourselves to get bogged down in too much regulatory or operational complexity. In this case, speed enhances sustainability.

Sustainability can’t be emphasized enough. Bacteria continue to develop resistance. We need to have a steady, productive R&D engine to keep turning out potent new antibacterials if we want to keep up in the fight.  

Extend investment into earlier stage innovation

The focus of the AMR Fund is an area of great need – ensuring that medications with clinical merit have the resources to make their way to patients as they approach approval. There is an opportunity to take this commitment one step further and use the resources available to further accelerate the early stage research that makes future weapons against bacteria possible.   

Our colleagues at the CARB-X and REPAIR funds (Full Disclosure: Spero has received investment from both groups) are doing wonderful work advancing dozens of early stage technologies towards translation and early clinical development; there are still more good ideas than there are resources.

The scale and longer time horizon of Big Pharma would be an excellent complement to ensure we are advancing a diversity of good ideas to combat the broad and unpredictable threat of infection. We applaud our colleagues at Roche, Pfizer, and Merck that continue to make investments in this field whether in collaboration or in-house. There is an opportunity to build further on these efforts. 

Use the megaphone with one voice

Along with a commitment to the AMR Fund, these same pharma companies emphasized their commitment to advocating for the structural reform necessary to tackle a broader set of infectious threats. 

Now that a broader subset of our industry has more skin in the infectious disease game, there is a tremendous opportunity for a unified voice to catalyze a pragmatic solution to the (primarily US) reimbursement system that stifles antibacterial innovation. 

In years past, this has been seen a niche issue – someone else’s problem. Within our ecosystem to date, at times we have fragmented in our support of different initiatives in part depending on how they affected each of us individually. This new momentum, and the newly unified approach among Big Pharma players, is an opportunity to band together around a solution that has the best chance to make it to the finish line. 

Our view at Spero is that the best type of incentive is the one that passes; it is highly unlikely that every drug developer will be an equal beneficiary of any solution. Our hope is that this new, broader coalition can play the long game with a stronger, unified voice in Washington to make one of the several workable solutions under discussion into a reality.  

This era of COVID-19 and the AMR Fund have demonstrated the best that Pharma and biotech can offer society. This industry is willing and able to move quickly against the biggest challenges facing humanity. This AMR Action Fund is an extension of this; while COVID-19 was largely unforeseen, we can see the AMR issue coming. We should use this time wisely to get ahead of the curve.

The AMR Fund has given our collective mission new momentum; it is now up to us as drug developers to make the right pipeline choices, to execute, and continue to work together.

My thanks to the Spero team, Tim Hunt, Aleks Engel from the Novo REPAIR Fund, and Kevin Outterson from CARB-X for their thoughtful critiques, policy understanding, and commentary

11
Jul
2020

Can Novartis Digitally Transform Clinical Development?

/
/
3
/
11 Jul 2020

David Shaywitz

In 2018, Dr. Vas Narasimhan, newly-installed as CEO, told the Wall Street Journal he saw Novartis as “a focused medicines company that’s powered by data science and digital technologies.” 

Since then, Novartis has tried to grow into this ambition, embracing the concept of digital transformation perhaps more conspicuously than any other large pharma. 

It’s not easy, as Narasimhan himself acknowledged one year in, when he discussed with refreshing candor his early efforts, and shared some of the hurdles and disappointments he encountered.

Now, Narasimhan, together with colleague Luca Finelli (a 15-year veteran of the company, with experience in modeling and analytics), have published a paper in Clinical Pharmacology and Therapeutics outlining Novartis’s initial effort to apply their data science mindset to global clinical development, an area they saw as a particularly attractive opportunity. (Narasimhan isn’t alone; at a recent NewYorkBIO webinar, J&J’s newly-appointed Chief Data Science Officer, Najat Khan, similarly emphasized the value of focusing on clinical development.)

Vas Narasimhan, CEO, Novartis

The choice isn’t — or shouldn’t be — a particular surprise: clinical development represents a huge slug of pharma’s total R&D expenditure, the operational complexity seems ripe for digital refinement, and the effect of any improvement should be appreciated relatively quickly by the organization; these contrast with potential digital upgrades on the research side, which could take far longer to prove themselves.

Novartis also made a deliberate (and prudent) decision at the outset to focus on operational data, specifically, rather than patient-data; the authors point out that because such data are “fundamentally of non-human origin,” they aren’t subject to the various data protection and privacy regulations that can introduce additional layers of complexity to data analysis – especially when such data are sourced globally.

The basic idea was to turn decades of clinical trial operational experience into something that could be represented digitally and understood broadly, so that lessons could be extracted and applied going forward. Historically (and in fact, not so historically, as this is generally what happens today in most companies), “summarizing the status of just one study” requires “a strenuous review of many spreadsheets to obtain first the country, then the regional, and finally the global overview.” These data, the authors explain, come “from different systems through manual, one-time extractions, at different time points, and often following different assumption and rules.”

Novartis’s aspiration was to turn “tedious, time-consuming tasks that can often take days or even weeks to complete manually” into something more enlightened and efficient, using the rich operational data that already exist. 

For example, the authors say, “historical trial management data indicate exactly how successful each medical center was at recruiting patients, for each investigational drug, past data shows how well clinical drug supply followed the initial plans, and finance data can tell the entire spend story behind a development program.”

In other words: armed with the requisite data, the company should be able to figure out how to select better clinical trial sites, improve the management of their drug supply, and estimate more accurately the true cost of developing a proposed medicine.

They aspired to build a data and analytics platform to achieve this goal (and were aided, apparently, by a McKinsey-owned analytics company called QuantumBlack). The initial challenge they faced was wrangling the relevant operational data. This was an especially difficult task since these data tended to be “locked into silos,” residing “in multiple internal dedicated system,” from which “extraction…is difficult, and requires time-consuming manual efforts that only IT personnel with special access rights can execute.” As they aptly summarize, the “operational data landscapes emerge as very fragmented.” 

A key issue, they discovered, was that most operational data were “not generated with the intention of doing analytics. It typically just supports temporary tasks and transitions.” Thus, “one of the monumental efforts…has been ‘connecting’ and ‘curating’ that data so that it could be seamlessly utilized across the operational landscape. This involved re-processing decades of data from a variety of systems, each with other formats and identifiers – getting the data ready for analytics was at the foundation for our digital transformation.”

As they wryly observe – referencing a previous piece I wrote – “the amount of work required to bring all the data from different sources together to an analyzable format is largely underestimated in the public excitement about AI and machine learning.”

Novartis’s vision for this platform – called “Nerve Live” – encompassed multiple areas, from clinical trial operations to financial modeling, each envisioned as essentially an “app,” intended to deliver “intuitive user experiences, elegantly combining advanced analytics with well thought out application design and the right data context.” 

The first app developed was an AI application designed to predict the “timing of ‘end of enrollment’ across > 300 studies simultaneous and through intuitive visualizations, allowed for root cause analysis down to single site activities…” According to the authors, a total of eight apps have now been developed, tackling topics from resource requirements to cost forecasts to patient enrollment predictions.

Naturally (like AstraZeneca, discussed here), Novartis also has a large “mission-control”-like room with a trial dashboard, the “SENSE Insights Center,” of which they seem especially proud.

I was especially interested in the discussion of “enablers” – essentially “key success factors” (assuming you accept the premise that this effort has been successful – we’ll come back to this). In addition to the inevitable citation of “senior leadership sponsorship,” they highlight the role of team composition and of the iterative approach they used, which I suspect were both critically important.

The key individual drivers of this process seemed to be the “product owners,” charged with leading all aspects of product development. 

While this model emulates the approach used by both tech companies and pharma clinical development teams, the secret sauce seems to be the traits and experiences required of these product owners, a “mixed set of core competencies” that “are not easy to find in a single individual.”

These include expertise in data science, business, user needs, learning agility, project management, design thinking, and experience with what’s known as “Agile” product development. 

Oh, and one more thing: “owners also need to know well how to navigate our IT process governance….”  I suspect this last item — figuring out how to productively engage with incumbent IT — was particularly important.

Another critical aspect seems to have been the iterative approach, where the initial work seemed to focus on just one app, with the idea that palpable success with this could enhance subsequent buy-in. 

Predictably, the most difficult challenges, according to the authors, involved not technology but rather “people, behaviors, and the change required for the transformation to succeed.”

Did it succeed? When they finally get to what seems like a critical question, the authors hedge – big time.

“Although we are just starting to assess systematically the benefit of the program,” they write, “initial projects indicate that productivity gains in the order of 10% are already achievable across the portfolio of activities.”

Translation: it’s not clear — yet — that the juice has been worth the squeeze.

My Takeaways:

I actually found this article to be enormously inspiring, representing what seems like a bold and ambitious vision, pursued intelligently.

I was pleased, though hardly surprised, to see the initial focus on operational data and palpable goals – two strategic elements I’ve long championed. I recognize the importance of identifying the right talent to lead these teams, though I can imagine, as Dr. Amy Abernethy, Principal Deputy Commissioner at the FDA, emphasized at a recent conference, that these qualities can and typically do reside in a group of people, and the real skill required might not be the multiple core competencies the authors aspirationally list, but rather the ability to elicit these from a well-chosen team.

That said, the critical importance of organizational savvy — alluded to discretely in the article — cannot be understated, as the work of Stanford’s Jeffrey Pfeffer has so clearly and painfully highlighted.

Finally, what of the results? If you’re a skeptic, you may look at all this, and probably say, “Surprise, surprise – another CEO shows up with his pet project, enabled by an army of consultants, lots of money is spent, lots of ink is spilt, and for what?” This is even how many critics view the efforts around precision medicine. The first rule of holes, they say, is to stop digging.

But I am encouraged. Emerging digital and data technologies offer pharma companies a critically important opportunity to do their critically important work better and, hopefully, cheaper. For incumbent companies, change is notoriously hard, and it’s always appealing to make cosmetic adjustments but to continue with business as usual as long as possible. And in fairness, it’s not always easy to know the right time to adopt a new technology and mindset; it’s possible Novartis is still too early, and the approaches available to companies in five or fifteen years will be so much better and so much cheaper that Novartis will feel foolish for choosing to be (in the context of the industry) an early adopter. 

But I think Novartis is doing something very smart. By embracing this change, they are learning about the talent and competencies that future success will require, and their employees are starting to think in a way that seems crucial for the industry going forward, gaining valuable experience that is likely to be in high demand over the next decade. 

I’m also not worried about the limited results apparently demonstrated to date; this is the nature of technology adoption – you need to figure out how to use it, and there’s what W. Brian Arthur has called a “mutual adaption” that’s required between technology and domain. I can envision the process Novartis is going through will ultimately lead to more efficient studies that are better for company and patients alike. 

What we’re seeing is the difficult work of a much-needed industry makeover. Good on Novartis for ambitiously taking on this challenge.

(Disclosure: I do not have a personal or business relationship with Novartis.)

10
Jul
2020

The Remdesivir Pricing Letter Gilead Should Have Written

/
/
2
/
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

/
/
2
/
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

/
/
0
/
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

/
/
0
/
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

/
/
2
/
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.

1 … 34 35 36 37 38 … 75

Get In-depth Biotech Coverage with Timmerman Report.

Individual Subscription

Group Subscription

Or: Sign in to your account

Your account

What Readers Are Saying

testimonial
testimonial
testimonial

View More Testimonials ➛

Twitter