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West Coast Biotech Roundup: Halozyme, Nektar, Allozyne, Novo & More

Xconomy Seattle — 

We’ll kick off this week’s roundup with two more FDA approvals of drugs brought to market by Big Pharma companies but originated in biotech labs. Biotechs have come to represent a big part of medicines that come to market, especially when innovation and medical need come into play most clearly.

According to this Nature study published a couple months ago, 107 different companies originated the 162 products that were approved by the FDA from 1998 to 2012 after a priority review—“the primary arena for both technological innovation and medical advances in drug development,” the author writes.

Of those companies, 67 were biotechs and 40 were pharma. The paper, from former biotech executive Donald Drakeman (now a VC in London), goes into more detail, not just about the prevalence of biotech-originated therapeutics, but the sector’s cost efficiency. It’s a good read, please do have a look. His numbers stop after 2012, but we’d be shocked if the trends have reversed, as Big Pharmas become ever more focused on the late clinical development and marketing end of the pipeline.

Also waiting in this week’s pipeline of news: our scoop on Seattle biotech Allozyne being sold off in pieces, Gilead Sciences gets bad news, and hints that Novo Nordisk might reinvest in Seattle. Let’s get to the roundup.

—Xconomy reported that the FDA approved HyQvia, a treatment for adults with primary immune disorders. It combines a disease-fighting immunoglobulin product by Deerfield, IL-based Baxter (NYSE: BAX) with a genetically engineered enzyme from San Diego’s Halozyme Therapeutics (NASDAQ: HALO). The FDA halted development of Hyqvia in 2012 after raising concerns that patients were generating antibodies against Halozyme’s flagship product, a recombinant human hyaluronidase, or rHuPH20. Getting market clearance for HyQvia is a significant milestone for the company and a crucial validation of Halozyme’s core technology, CEO Helen Torley said.

—The FDA on Wednesday approved naloxegol (Movantik), a treatment for opioid-induced constipation that was originally developed by San Francisco-based Nektar Therapeutics (NASDAQ: NKTR). Nektar licensed the drug to AstraZeneca in 2009 when it had completed Phase 2 trials. AZ paid $125 million upfront and threw in nearly $100 million more last fall when U.S. and European regulators agreed to review naloxegol for approval. This week’s FDA approval will make Nektar eligible for some of the remaining $140 million in milestone payments. Nektar can also earn up to $375 million in additional sales milestones and royalties down the road.

—Xconomy reported Thursday that Seattle biotech Allozyne, once an ambitious graduate of the local Accelerator incubator, is being sold off in pieces. Most was sold to MedImmune, the biotech division of AstraZeneca, earlier this year, and Allozyne’s chairman told Xconomy he’s looking for a taker for Allozyne’s lead product, a longer-acting version of the multiple sclerosis drug beta interferon.

—Viking Therapeutics, a San Diego firm spun out through a licensing deal with Ligand Pharmaceuticals (NASDAQ: LGND), was poised to go public, as of this writing. The firm is offering 5 million shares at an expected price between $10 and $12 a share. The company licensed five drugs from Ligand, targeting diabetes and other metabolic and endocrine disorders. At $11 a share, the company would raise gross proceeds of $55 million and have a market valuation of about $167 million. Ligand owns almost 25 percent of the outstanding shares; Viking CEO Brian Lian, who was previously a senior equity research analyst covering biotech, also holds almost 25 percent, and Viking COO Michael Dinerman owns another 11 percent. The company plans to list its shares on the Nasdaq market under the ticker symbol VKTX.

—Gilead Sciences (NASDAQ: GILD) of Foster City, CA, said Wednesday that its pancreatic cancer treatment simtuzumab failed to meet the firm’s goals in a Phase 2 study. The study compared a combination of simtuzumab and the chemotherapy gemcitabine to gemcitabine-plus-placebo. The simtuzumab combination did not significantly increase patients’ progression free survival. Gilead’s chief scientific officer Norbert Bischofberger said in a statement that the company will continue with ongoing trials of simtuzumab in cancer, myelofibrosis, lung and liver diseases.

—Novo Nordisk, which is awaiting U.S. approval of a weight-loss drug, could significantly expand its obesity R&D staff, its chief science officer said in a Bloomberg News report published Thursday. Because the U.S. has a dire obesity problem as well as some of the best scientists, Novo Nordisk might center its efforts in its Seattle research facility, where it recently laid off its inflammation R&D team.

—Thermo Fisher Scientific (NYSE: TMO) said it has completed the listing of its Ion PGM Dx, a nex-generation genome sequencing system, with the FDA for clinical use as a medical device. Carlsbad, CA-based Life Technologies, which Thermo Fisher acquired earlier this year, has been responsible for bringing the desktop gene-sequencing machine to market.

—In a separate announcement, Thermo Fisher Scientific and the UC San Diego Office of Research Affairs unveiled the Duane Roth Innovation Grant, which provides $50,000 for sponsored research at UC San Diego to support proof of concept and technology applications. The grant honors the late Duane Roth, a longtime San Diego life sciences leader and CEO of Connect, the nonprofit group supporting technology innovation and entrepreneurship in San Diego.

—San Francisco-based Sutro Biopharma inked a deal with Germany’s Merck KGgA’s EMD Serono division to co-develop antibody-drug conjugates for treating cancer. The total amount of potential milestone payments is approximately $298 million, not including sales royalties. The companies did not disclose other financial details.

—Universal Cells, a company founded in 2013 to commercialize stem-cell technology developed at the University of Washington, has raised $290,000 in early stage funding through a convertible note. This first financing for the Seattle company comes from friends, family, and unnamed local investors. It will allow Universal Cells to advance product development and in vivo proof of concept studies of what CEO Claudia Mitchell described as “universally compatible pluripotent stem cells that engraft without immune rejection.” The firm is also pursuing partnerships with clinical-stage stem cell companies to use its universal donor cells for disease treatment, according to Mitchell.

—Carlsbad, CA-based Colorscience, which provides cosmetic and skin care products, said it has raised $15 million in a Series B preferred stock round led by Longwood Fund and joined by existing investors Montreaux Equity Partners and Split Rock Partners. Colorscience offers premium, “all-in-one” makeup for women.

Xconomy San Diego Editor Bruce V. Bigelow and Seattle Editor Ben Romano contributed to this report.

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One response to “West Coast Biotech Roundup: Halozyme, Nektar, Allozyne, Novo & More”

  1. defrajac says:

    Since when a make-up company is covered in a life science/biotech section? I don’t get it!