Life Science Today 019 – Biogen, Novo Nordisk, and Merck
Originally Published as The Niche Podcast
Introduction
Welcome to The Niche Podcast – Your weekly 5-minute rundown of the biotech, clinical research, and applied science industries. I’m your host, Dr. Noah Goodson. This week, aducanumab skeptics, Novo Nordisk and Merck make acquisitions, but first a market update.
Market Update
Markets rose sharply last week, with the DOW gaining more than 6% and the NASDAQ up over 7.5%. This followed a week of losses at the end of October. As of recording, futures for both markets are looking up. While numbers may continue to climb through the next week or two, I would predict a degree of turbulence as conflicting pieces of news vie for investor’s attention.
The United States has selected a new president and markets generally respond positively to completed election cycles, regardless of the winner. However, COVID19 cases are currently through the roof, with more than 100,000 new cases daily across the United States. Even with FDA approved therapies like remdesivir available, deaths and local to regional shutdowns can be expected throughout the holiday season. The current sitting president’s operation warp speed has likely expedited the development of COVID19 vaccines, but none are currently shown to be safe and effective and it will be at least Q1 of 2021 before any meaningful distribution can occur – that’s assuming clinical trials are successful and the FDA approves. More than 10 million Americans have now been diagnosed with COVID19 and many key experts are predicting a challenging winter. If true, this will certainly impact the markets.
Aducanumab Skeptics
The potential block-buster Alzheimer’s therapeutic aducanumab from Biogen was rejected by the FDA last year. In a surprise move, Biogen doubled down, running a further phase 3b “PRIME” trial and resubmitting to the FDA. Last week, the FDA advisory committee for peripheral and central nervous system drugs voted on the results of the PRIME study. Without getting into details, the committee voted against the drug being able to treat Alzheimer’s. While this is not the same a final decision from the FDA, the votes do not bode well for the Biogen pipeline. There is still a possibility of further study, or that based on the lack of any meaningful therapeutics in the space, aducanumab will scrape through, but for now, the results are not looking promising. Expect their shares to drop dramatically when stock markets open Monday.
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Novo Nordisk Acquires Emisphere Technologies
Novo Nordisk acquired the new Jersey-based drug delivery company Emisphere Technologies for $1.8 billion. Emisphere primarily provides a drug delivery platform called Eligen SNAC. Their system is designed to enhance the delivery of drugs by increasing their stability and absorption through the use of specific carriers. In certain cases, this provides an opportunity to move from an injectable to an oral tablet. For Novo Nordisk this is a long-term investment. They see Eligen SNAC technology as a means to empower delivery of biologics in the future. Novo Nordisk worked with the Eligen SNAC platform to develop the first orally available biologic, Rybelsus. The acquisition of Emisphere eliminates the royalty requirements on this drug and empowers Novo to move forward with the development of further oral biologics.
The deal will be financed via debt and is not expected to impact the Q4 2020 or 2021 guidance.
Merck Acquires VelosBio
After a quiet Q1 and Q2, Merck has been busy through Q3 and 4 of 2020. In the latest move, they are acquiring VelosBio for $2.75 billion in cash. VelosBio’s lead candidate VLS-101, is an antibody-drug conjugate (ADC) targeting ROR1. VLS-101 is currently in phase 1 and phase 2 trials for the treatment of hematological cancers as well as solid tumors. The early data on VLS-101 suggests that it may be effective in treating a number of cancers, even when other first-line therapeutics have failed. Additionally, VLS-101 has shown a relatively manageable safety profile for an ADC therapeutic.
ROR1 is a surface protein that is expressed in high levels in a variety of cancers. VelosBio has developed antibodies that specifically and efficiently target ROR1, they are then able to conjugate receptors for T cells or natural killer cells to the antibodies. In effect, this draws the attention of the immune system to the tumor or cancerous cells and encourages a natural immune response. There are numerous challenges in developing ADC therapeutics and finding one that works effectively without immense auto-immune side effects is challenging. Merck clearly thinks VelosBio has done this. The addition of VLS-101 as a second or third-line cancer therapy fits neatly into Merck’s current portfolio. Remember, Merck’s Keytruda is also an ADC therapy and it is making well north of $12 billion this year. Some estimates suggest it could be hitting $20 billion+/year by 2024. Building on this ADC portfolio to expand combined therapies will be critical for Merck through the next five years as they reposition themselves as a leader in the oncology space.
Special Announcement
Hi folks, Dr. Noah Goodson here. I want to let you know about a special bonus episode coming in a couple of weeks. I’m sitting down with a young COVID survivor who also works in healthcare. We’ll be hearing about the dramatic personal consequences of this disease, even for the young and healthy, and getting an inside look at the experience of just one of the millions of front-line workers. I think you’re really going to enjoy this, so keep your eyes on your podcast feed for this upcoming Niche Podcast Bonus
Closing Credits
Thanks for joining me on The Niche Podcast; your weekly 5-minute summary of top news in the biotech, clinical trials, and applied science industries. You can find us on your favorite podcast app. Like, comment, subscribe, and most of all share with your friends. If you like what you hear, please rate and review, it really helps us. Once again, I’m Dr. Noah Goodson, I’ll see you next week.
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Story References
https://www.sciencemag.org/news/2020/11/biogen-s-alzheimer-s-drug-candidate-takes-beating-fda-advisers
https://www.merck.com/news/merck-announces-third-quarter-2020-financial-results/
https://www.novonordisk.com/news-and-media/news-and-ir-materials/news-details.html?id=33374
Music by Luke Goodson
https://www.soundcloud.com/lukegoodson