Diabetes drugs are Eli Lilly’s bread and butter, but the pharmaceutical giant hasn’t lost its appetite for cancer drugs. It grabbed hold of a few more this week by betting $8 billion on Loxo Oncology.
Loxo (NASDAQ: LOXO) has made a name for itself by becoming one of just two companies ever to earn an FDA approval for a drug that targets a tumor’s DNA fingerprint, no matter where in the body that cancer is found. The drug, larotrectinib, targets rare tumor abnormalities known as NTRK fusions. The challenge now falls to Lilly (NYSE: LLY) to find the patients who have those mutations, and get them on treatment—a touchstone for the commercial viability of such precision cancer medicines. Lilly will now take on the rest of Loxo’s work, too, which includes other so-called tissue-agnostic drugs like larotrectinib.
The deal was one of two mega-buyouts that kicked off the annual J.P. Morgan Healthcare conference in San Francisco, the massive meeting that sets the tone for the biopharma sector each January. Xconomy was there; Read on for a peek into our notebooks.
This week also saw the introduction of drug-price legislation in Congress, growing concern about the partial government shutdown’s effects on the biotech sector, and more cash flowing into startups. We’ll get to those stories and more in this week’s news roundup.
LET’S MAKE A DEAL
—Eli Lilly agreed to pay $8 billion cash to acquire cancer drug developer Loxo Oncology, a deal that follows recent mega-acquisitions in oncology by Bristol-Myers Squibb (NYSE: BMY) and GlaxoSmithKline (NYSE: GSK).
—Genentech paid Adaptive Biotechnologies $300 million upfront in a partnership to develop personalized cancer immunotherapies.
FROM THE BELTWAY
—Due to the partial government shutdown, fees that fund FDA reviews of experimental drugs will be shifted to cover post-market drug safety surveillance, commissioner Scott Gottlieb said this week. The move focuses the agency on more immediate potential threats but could delay its review of new drugs. Gottlieb said the fees for new product reviews will run out in a month or two.
—The partial shutdown might also cool off the hot biotech IPO market. The SEC isn’t reviewing or approving regulatory filings, including proposed IPO plans, so companies hoping to go public this month will probably have to wait, the Wall Street Journal reported.
—Sen. Bernie Sanders (I-VT) and Rep. Elijah Cummings (D-MD) introduced legislation to rein in rising drug costs by tying a medicine’s price in the U.S. to the median price of that drug paid in five other industrialized countries. Reuters reported that the legislation would also give the government the authority to negotiate drug prices in Medicare Part D, and allow Americans to buy drugs from other countries, where they are less expensive.
—In San Francisco, thousands of people gathered at the J.P. Morgan Healthcare conference and satellite meetings for the ultimate deal-making, stock-breaking, life-science networking jam session that sets the tone for the new year. Xconomy’s Alex Lash, Ben Fidler, and Sarah de Crescenzo were on the ground, conducting dozens of interviews, and our annual “Notes from the Vortex” feature provides a first look at what was on people’s minds: high prices (for drugs and hotels), the gender gap, gene therapy, the Celgene (NASDAQ: CELG) legacy, and much more.
—Sage Therapeutics (NASDAQ: SAGE) saw its stock price jump more than 50 percent after reporting positive results for its drug SAGE-217 a in a Phase 3 study in women with postpartum depression. The pill is also being tested in major depressive disorder, insomnia, bipolar depression, and more.
—UroGen Pharma (NASDAQ: URGN) released Phase 3 results showing that 57 percent of patients responded to its drug UGN-101, a treatment for a type of bladder cancer. The New York company hopes its drug offers an alternative to surgery.
—Allergan (NYSE: AGN) is joining the biotech migration to Cambridge, MA, announcing plans to open a research site in Kendall Square.
—Sanofi (NYSE: SNY) is paying Regeneron Pharmaceuticals (NASDAQ: REGN) $342 million to wind down an immuno-oncology partnership inked in 2015, save for two bispecific antibody drugs that are now in clinical testing for multiple myeloma and other cancers.
—Japanese regulators became the first to approve Amgen’s (NASDAQ: AMGN) osteoporosis drug romosozumab (Evenity). The drug has had a rocky road. The FDA rejected it last year, calling for more data. It’s currently under review in the U.S. and Europe.
—Cancer drug developer Apollomics unveiled a $100 million Series B round and will move its headquarters from China to Foster City, CA.
—Twelve more health systems representing roughly 250 U.S. hospitals have joined Civica Rx as founding members. Seven organizations formed the nonprofit generic drug maker earlier this year in a bid to combat high drug prices and manufacturing shortages.
—A month after emerging from stealth, Black Diamond Therapeutics unveiled $85 million in Series B financing to advance up to three cancer drugs into clinical trials in the next two years. Black Diamond is setting up its headquarters in Cambridge.
—Beta Bionics boosted its Series B financing to $63 million as it prepares for late-stage tests of its medical device, a “bionic pancreas” that mimics the organ’s role in type-1 diabetes patients.
—Providence Ventures, the investment arm of health system Providence St. Joseph Health, closed a $150 million fund that will invest in medical technology startups.
—New York drug-discovery software specialist Schrodinger continued a push to develop its own medicines, raising an $85 million round led by The Bill and Melinda Gates Foundation Trust and WuXi AppTec’s venture fund.
Corie Lok, Ben Fidler, and Alex Lash contributed to this report.