If you’re running a privately held biotech, the time to go public is now. Clinical data already in hand or not, biotechs have charged to Wall Street at a record pace over the past two weeks, raising more than $1 billion in offerings that all met or exceeded their projected valuations. And there are no signs of slowing down—six more just recently joined the queue, many of them without scant, if any evidence, in humans, their drugs work. That’s great news for early stage life sciences investors and the overall health of the startup biotech ecosystem. But it also sets up some spectacular falls when clinical data fail to match the IPO hype. Witness this week’s blowups at Arsanis and Summit Therapeutics, which priced modest IPOs in 2017 and 2015, respectively.
That story and the rest of this week’s headlines below.
—Four biotechs and one medical device company went public this week, raising a total of $651 million. Like the wave of biotech IPOs last week, companies this week either met or exceeded their IPO targets.
—As companies traverse the IPO window, a new slate of companies have stepped up to take a place in line. Replimmune, Rubius Therapeutics, Allakos, Crinetics Pharmaceuticals, Constellation Pharmaceuticals, and Liquidia Technologies each filed paperwork to kickstart the IPO process.
—Shares of Summit Therapeutics (NASDAQ: SMMT) plummeted 80 percent after the company’s experimental Duchenne muscular dystrophy drug failed a Phase 2 trial. Summit will dump the drug, which has been part of a partnership with Sarepta Therapeutics (NASDAQ: SRPT), and restructure.
—Arsanis (NASDAQ: ASNS) of Waltham, MA, reported that a Phase 2 study of its experimental pneumonia treatment is unlikely to succeed. Arsanis will stop enrolling patients and focus on other programs. Shares cratered, falling 78 percent.
MORE DATA DUMPS & UPDATES
—Luspatercept, an experimental blood disease drug from Acceleron Pharma (NASDAQ: XLRN), succeeded in a Phase 3 study in myelodysplastic syndrome, sending shares up about 27 percent. The news is a boost for partner Celgene (NASDAQ: CELG), which has suffered a number of clinical setbacks of late. Acceleron should soon report Phase 3 results for luspatercept in beta-thalassemia as well.
—Cancer immunotherapy combinations have finally broken through against small cell lung cancer, an aggressive form of the disease often linked to smoking. Roche said that a combination of chemotherapy and its immunotherapy atezolizumab (Tecentriq) succeeded in a Phase 3 trial and will be submitted to regulators in the U.S. and Europe for a review.
—AstraZeneca (NYSE: AZN) and Merck (NYSE: MRK) said their PARP inhibitor, olaparib (Lynparza), succeeded in a Phase 3 study of women whose ovarian cancer was caused by BRCA mutations. Olaparib became the first in the emerging class of drugs to prove its worth as a first-line maintenance therapy, meaning it kept the cancer at bay longer than a placebo in patients who had responded to chemotherapy.
—Galapagos NV (NASDAQ: GLPG) disclosed disappointing results from a mid-stage study, Pelican, testing a three-drug combination in cystic fibrosis patients. Galapagos is now “reviewing the future of its CF collaboration” with AbbVie (NYSE: ABBV). The news marks a setback for another potential Vertex Pharmaceuticals (NASDAQ: VRTX) rival in CF. Vertex shares climbed almost 8 percent.
—Hemophilia gene therapies are making the transition to late stage testing. This week, UniQure (NASDAQ: QURE), one of several hemophilia gene therapy developers, enrolled the first patient in a Phase 3 trial of its experimental AMT-061.
ON CAPITOL HILL
—In testimony before the Senate finance committee, Health and Human Services Secretary Alex Azar reiterated his support for reducing prescription drug prices, but he offered few new details beyond the “blueprint” plan that he and President Trump unveiled in May.
—For the first time, the FDA approved a medicine that has a marijuana derivative. The agency cleared cannabidiol (Epidiolex), a pill from GW Pharmaceuticals (NASDAQ: GWPH), for two rare forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome.
—The FDA also approved the combination of Array Biopharma (NASDAQ: ARRY) drugs encorafenib (Braftovi) and binimetinib (Mektovi) for skin cancer that either can’t be treated by surgery or has spread to other parts of the body.
—The Achaogen (NASDAQ: AKAO) drug plazomicin (Zemdri) went 1 for 2 at the FDA. The agency approved the antibiotic as a treatment for complicated urinary tract infection but rejected it for bloodstream infections.
DEALS & CASH GRABS
—AbbVie (NYSE: ABBV) and Calico extended their collaboration to discover and develop new treatments for diseases of aging. The agreement tacks on three years to the partnership, and each company is kicking in an additional $500 million toward the research.
—Online retail giant Amazon (NASDAQ: AMZN) said it would buy PillPack, an online pharmacy, giving shape to its long-held ambitions to enter the drug distribution business. No price was disclosed, but the Wall Street Journal reported the deal at $1 billion.
—Akebia Therapeutics (NASDAQ: AKBA), in a heated race with FibroGen (NASDAQ: FGEN) to bring an anemia-fighting pill to market, agreed to merge with Keryx Pharmaceuticals (NASDAQ: KERX) in an all-stock deal. Keryx already has a marketed drug, ferric citrate (Auryxia), for patients with failing kidneys.
—Liquid biopsy developer Exosome Diagnostics agreed to be acquired by Bio-Techne for $250 million in cash, plus up to $325 million more if the Waltham, MA company hits milestones.
—U.K.-based Nodthera closed a $40 million Series A, which the company will use to develop treatments for diseases characterized by chronic inflammation.
—The crowded field of companies developing drugs for the liver disease nonalcoholic steatohepatitis added another startup. Akero Therapeutics made its debut with $65 million raised and an early-stage drug licensed from Amgen (NASDAQ: AMGN).
—Precision Biosciences raised $110 million in Series B financing as the Durham, NC, biotech steers its gene-edited cancer cell therapy to clinical trials.
—Helix bought Denver’s HumanCode to bolster its new online store that sells products based on customer DNA. HumanCode currently sells two apps, and its executives have ties to Helix CEO Robin Thurston.
—CStone Pharmaceuticals paid Agios Pharmaceuticals (NASDAQ: AGIO) $12 million upfront for Chinese rights to Agios’s blood cancer drug ivosidenib (Tibsovo). Agios could get another $412 million if the drug hits certain development and sales targets. Ivosidenib could be approved in the U.S. by late August.
—A year after investing in Dragonfly Therapeutics, Celgene (NASDAQ: CELG) has backed another startup from tech entrepreneur Bill Haney. This time, Celgene put $100 million into Skyhawk Therapeutics, which is developing drugs that target RNA molecules.
—We looked back at our latest New York biotech event, “Bringing Back the ExPats,” which featured biopharma veterans who are ex-New Yorkers surveying the state of life sciences in the Big Apple. You can check out photos and takeaways from the event here.
Frank Vinluan and Alex Lash contributed to this report.