Sanofi Goes Public with Hostile Medivation Bid Sukaina Virji [email protected], Mandy Jackson [email protected]

Sanofi Goes Public with Hostile Medivation Bid Sukaina Virji Sukaina.Virji@Informa.Com, Mandy Jackson Mandy.Jackson@Informausa.Com

STOCKWATCH EXCLUSIVE INTERVIEW Valeant Reset: Will It Cure What Ails It? Now that the first-quarter of 2016 is Sosei conducted a master stroke Valeant finally filed its 10-K with the behind us, attention turns to the rest of last year when it acquired UK SEC, disclosing new investigations into the year (p21) biotech Heptares as its in-house R&D pricing and business practices (p4) engine (p20)

6 May 2016 No. 3801

Scripscripintelligence.com Pharma intelligence | informa Sanofi Goes Public With Hostile Medivation Bid Sukaina Virji [email protected], Mandy Jackson [email protected]

ollowing weeks of speculation, Sanofi Medivation failed to see how its inves- has gone public with its hostile offer tors would benefit from an acquisition at Ffor Medivation. Analysts are all in agree- $52.50 in cash per share, so it announced ment that the deal would make “strategic its rejection of Sanofi’s unsolicited buyout sense” for Sanofi, but it’s likely other suitors offer while the French pharma firm was will throw their hats into the ring. Meanwhile, conducting its earnings conference call on Medivation fails to see how its investors April 29. would benefit from the acquisition. The offer Medivation felt that the deal was not in for Medivation follows CEO Olivier Brandi- its or its shareholders best interests, how- court’s reorganization of Sanofi in which ever, noting that Sanofi’s offer “substantially oncology is one of the businesses where he undervalues” the company. Hung accused plans to build a competitive position. Sanofi of taking advantage of the recent de- Sanofi says it made a non-binding pro- cline in biotech stock values to acquire Me- posal to acquire San Francisco-based Medi- divation at a price well below its 2015 peak vation Inc. for $52.50 per share, an all-cash of $67.78 per share. transaction valued at $9.3bn, almost two “Sanofi’s opportunistically-timed propos- Olivier Brandicourt weeks ago. It proposes that Medivation al, which comes during a period of signifi- ket, and would immediately enhance earn- would sit within its successful Sanofi Gen- cant market dislocation, and prior to several ings. Sanofi has experience in the prostate zyme specialty unit. important near-term events for the com- cancer space through marketing Jevtana In a public follow-up letter dated April pany, is designed to seize for Sanofi value (cabazitaxel; with sales of €321m in 2015). 28 and addressed to Medivation’s CEO Da- that rightly belongs to our stockholders. We Medivation’s Xtandi is co-marketed with vid Hung, Brandicourt says he first called believe the continued successful execution Astellas in the US, and Medivation gets Hung about a potential combination of of our well-defined strategic plan will deliver royalties for ex-US sales. Xtandi had 2015 the companies on March 25 but “you said greater value to Medivation’s stockholders sales of around $2bn. Its two late stage you were unwilling to meet.” The offer was than Sanofi’s substantially inadequate pro- assets are talazoparib, a PARP inhibitor in then sent on April 15. “We have not heard posal,” Hung said. Phase III development for breast cancer anything from you in almost two weeks… Medivation has one marketed drug, the (acquired from BioMarin Pharmaceutical We do not understand the delay in re- prostate cancer therapy, Xtandi (enzalu- in 2015); and pidilizumab, a humanized sponding,” complained Brandicourt. The tamide), and two additional oncology assets monoclonal antibody in Phase II develop- $52.50 per share proposed purchase price in clinical development. ment for DLBCL. represents a premium of over 50% to Me- Goldman Sachs analysts have forecast “An acquisition of this nature could, in divation’s two-month volume weighted Medivation sales of $1.15bn in 2017, rising one go, boost Sanofi’s prostate cancer average price (VWAP) prior to there being to $1.71bn in 2020. They believe the deal presence and rejuvenate its oncology takeover rumors – but just 1% to the clos- makes “strategic sense” as it strengthens ing price on April 27. Sanofi’s position in the key US oncology mar- Continued on page 7 in this issue AstraZeneca is The most difficult parts restructuring and of the jobs of investors streamlining its and analysts is to predict commercial and the future manufacturing Drug pricing operations under a new has become cost-cutting effort the most contentious issue 7 9 21

COVER / Sanofi Goes Public With from the editor Hostile Medivation Bid [email protected] 3 Novartis’s Entresto Clears NICE But It’s A Close Run Thing

The news this week of an $18bn “merger of equals” 4 Valeant Reset: Will It Cure What Ails It? between Quintiles and IMS Health was as surpris- 6 Bayer Thins R&D Pipeline, Backs Finerenone In Kidney ing as the mating of two different species. Perhaps But Not Heart Disease in the same way that our first reaction to a liger or a wholpin is one of incredulity and suspicion (did that 7 Panel: Pricing Dilemma Divides Industry Stakeholders actually work?), investors immediately recoiled from 8 Lilly Executes Growth Strategy As New Products Drive the planned coupling of the CRO giant and the be- Sales Gains hemoth of prescription data. Quintiles’ share price plummeted 8.9% before closing down 2.4% on the 9 AstraZeneca Crows About Oncology Portfolio In 1Q; day of the announcement while IMS dropped 8.1% Strives For $1.1bn Cost Save before closing down 3.5%. 10 What’s On CEO Andrew Witty’s To-Do List Before For the two firms’ clients, though, the abnormal- Exiting GSK ity of the union could be what makes it attractive. Pharma companies know that grasping the big data 11 Business Bulletin bull by the horns promises great rewards both in 14 Ironwood Buys AstraZeneca’s Zurampic As Ideal Linzess product R&D and in the commercial sphere, and can Complement help shape conversations with payers. But data from different domains is siloed, so hard to cross-link and 15 Data Trumps Anecdotes, Emotion At Sarepta Panel fully exploit. Bringing together market leaders in pre- and post-market data could help fix that. Like 16 Court: No Herceptin Biosimilar Tag For Indian Trastuzumabs the mule, the offspring of this deal could prove more 17 Acadia’s Nuplazid OK’d; A Billion Dollar Parkinson’s Drug? useful to pharma than either of its parents. 18 Erbitux Being TAILOR-Made For Chinese First-Line mCRC Market, But Brand Recognition Is Merck’s Real Goal

19 R&D Bites

20 Exclusive Interview: Heptares-Powered Sosei’s exclusive online content Incoming CEO Explains What Happens Next

21 Stockwatch: Fanfare For A Biotech Bottom Video Interview: TxCell Plans US Studies In Crohn’s http://bit.ly/1VIivYp 22 Pipeline Watch CEO Stéphane Boissel tells Sten Stovall why the French cell therapy company is exploring the therapeutic potential of 23 Appointments regulatory T-cells (Tregs) in large-scale studies and extending its Phase IIb clinical study to the US using a recently granted IND.

Video Interview: CEVEC CEO On US Deal To Expand Business http://bit.ly/1QR2jMr Cheif Frank Ubags talks about how the platform technology company is enabling gene therapy companies to move their products into large scale clinical trials. @scripnews /scripintelligence

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2 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

Novartis’s Entresto Clears NICE But It’s A Close Run Thing john Davis [email protected]

he innovative nature of Novartis AG’s new chronic heart fail- fraction, in patients with New York Heart Association (NYHA) class ure therapy Entresto counted towards NICE’s appraisal com- II to IV symptoms, a left ventricular ejection fraction of 35% or less, T mittee clearing its use in Britain’s National Health Service, de- and who are already taking a stable dose of ACE-inhibitors or an- spite a cost-effectiveness ratio that was close to the upper limit for giotensin II receptor blockers (ARBs). gaining a positive recommendation. The positive recommendation came despite NICE’s appraisal com- Novartis’s new high-profile oral chronic heart failure therapy En- mittee calculating the incremental cost-effectiveness ratio (ICER) for tresto (sacubitril plus valsartan) has been recommended for use in Entresto as being between £26,000 ($38,000) and £30,000 ($43,000) England and Wales’s National Health Service (NHS) by the UK HTA per quality-adjusted life year (QALY) gained, near the upper limit of body, the National Institute for Health and Care Excellence (NICE), what NICE considers cost-effective for use in the NHS. What seemed giving a boost to a product that has so far found it difficult to live to count in Entresto’s favor was its innovative nature, in a disease up to its potential blockbuster status. area that has seen little innovation over the past 25 years. Final NICE guidance was published on April 27 confirming a pro- NICE’s director of valuation Carole Longson said the £3-a-day visional positive recommendation issued Dec. 11, 2015 on the use drug would be used in people with severely reduced ejection of Entresto within the NHS in England and Wales. The guidance by fraction who are almost constantly bedbound, helping them the internationally well-respected organization may improve pre- take part in normal daily activities and reducing their need for scriber sentiment towards Entresto, and boost its sales, after hav- hospital treatment. But Longson pointed out the guidance does ing been launched in the US in the middle of last year, and in its not recommend Entresto’s use in patients with mild symptoms, first markets in Europe at the end of 2015. The drug only generated or those who have not already been treated with an ACE-inhib- $17m in sales in the first quarter of 2016. Germany’s IQWiG also itor or an ARB. ruled provisionally in Entresto’s favor several weeks ago, as did the The company has set a modest sales target of around $200m Scottish Medicines Consortium. this year for Entresto, as cardiologists are likely to continue to take In the NICE guidance, Entresto is recommended as an option for a cautious approach to prescribing, preferring not to change the treating symptomatic chronic heart failure with a reduced ejection medication in heart failure patients with stable disease.

scripintelligence.com 6 May 2016 | Scrip intelligence | 3 headline news

Valeant Reset: Will It Cure What Ails It? Donna Young [email protected]

n Valeant Pharmaceuticals International disclosed in its 10-K filing that North Caro- Inc.’s long-awaited 10-K, which finally got lina and New Jersey have recently opened Ifiled with the Securities and Exchange new probes. Commission (SEC) on April 29, the company In March, Valeant received an investiga- disclosed new investigations into its busi- tive demand from North Carolina’s Depart- ness pricing and business practices and fur- ment of Justice seeking materials related ther pulled back the veil on its relationship to the production, marketing, distribution, with Philador Rx Services LLC – the specialty sale and pricing and patient assistance pharmacy for which the Canadian drug programs related to three of the compa- maker had a shady distribution partnership, ny’s drugs – Nitropress (sodium nitroprus- which has since ended. side), Isuprel (isoprenaline) and Cuprimine Valeant also confirmed reports it was (penicillamine). bringing on new members to its board – On April 20, Valeant received a subpoena nominating Argeris Karabelas, a partner at from the New Jersey State Bureau of Securi- Care Capital and the founder and former ties requesting documents concerning the chairman at Novartis BioVenture Fund; Rus- company’s former relationship with Philidor, sel Robertson, executive vice president and its accounting treatment for sales to the head of anti-money laundering at BMO Fi- dobi rob Shutterstock: specialty pharmacy, the drug company’s nancial Group; and Amy Wechsler, a New financial reporting and public disclosures York dermatologist. company is headed in a different direction,” and other matters. The company said it was “The three new directors seem to have the charged Sen. Claire McCaskill (D-MO), who cooperating with both new investigations. right background,” said BMO Nesbitt Burns a few days earlier had convened a hearing Valeant said it may be making changes in the Inc. analyst Alex Arfaei. with her Republican counterpart on the way it conducts its business and to its busi- Michael Pearson, who has been replaced Senate Aging Committee, Sen. Susan Col- ness strategy. as CEO by Joseph Papa, who also is taking on lins (R-ME), who chairs the panel, focused “Some of these changes may be signifi- the role of chair at Valeant, and former chief on Valeant’s pricing practices. “But at this cant,” it said. financial officer Howard Schiller are standing point, we all have reasons to be skepti- The firm said it was assessing its practic- down for re-election. cal. The cultural and structural problems es related to pricing and “considering cer- The board had tried in March to oust at Valeant run bone-deep and if there’s tain changes thereto.” At the April 27 Sen- Schiller, who was accused of “improper con- going to be any future for the company ate hearing, Ackman said it wanted to see duct,” but he denied those charges and re- they’re going to have to stop exploiting a 30% across-the-board reduction in the fused to resign. patients, hospitals and the government in prices of Nitropress and Isuprel charged Five other current board members also an attempt to enrich themselves and their to hospitals. will not be standing for re-election at the shareholders.” June 14 annual meeting. Billionaire activist McCaskill also criticized Valeant’s plan to Financial Woes shareholder Bill Ackman, along with four pay its new CEO Joseph Papa about $67m – Valeant said its filing of the 10-K has “cured others, have been nominated for re-election a compensation package that could end up in all respects” the default under the com- to the board. being worth $500m. pany’s senior note indentures triggered by Valeant also said that, going forward, the failure to timely file the form. The firm one or more independent board mem- Investigations said it remains in full compliance with its bers would periodically attend the Collins and McCaskill, as well as the Re- credit agreement. Valeant had delayed the company’s planning and forecasting publican and Democratic leaders of the 10-K due to an internal investigation into telephone conferences and its periodic House Oversight and Government Reform its dealings with Philidor. business reviews “to monitor, and, if Committee, have been digging into sig- The company had previously disclosed necessary, address any tone at the top, nificant price hikes by Valeant and other it had identified misstatements related to management override, corporate gover- companies. Philidor that reduced its fiscal year 2014 nance, internal control and accounting But the Senate and House investigations revenue by about $58m and net income by and financial reporting issues.” into Valeant are among many ongoing about $33m. Valeant also identified misstate- “Only time will tell if this amounts to probes of the firm’s business and pricing ments in the first quarter of 2015, consisting meaningful, substantive change – or if practices. primarily of the reversing effect on earnings it’s simply rearranging deck chairs on the Along with investigations by the SEC, of the 2014 misstatements, which reduced Titanic in a desperate attempt to fool the prosecutors in New York and Massachusetts revenue by about $21m, but increased net business community into believing the and the Texas Medicaid program, Valeant income by $24m.

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scripintelligence.com 6 May 2016 | Scrip intelligence | 5 headline news

Bayer Thins R&D Pipeline, Backs Finerenone In Kidney But Not Heart Disease john Davis [email protected]

ermany’s leading pharmaceutical BAY 1007626 and roniciclib. But one piece of company Bayer has taken future good news was that Bayer intends to move Gcompetition into account when the oral progesterone receptor modulator stopping the Phase III development of fi- vilaprisan into Phase III for uterine fibroids, nerenone for congestive heart failure, and after a first Phase II trial in the condition indi- targeting specific CHF patients for treat- cated it had a “very competitive” profile. ment with another potential cardiovascular, vericiguat. Pipeline Still Strong The German multinational Bayer AG Is Bayer’s mid-term pipeline strong enough has bowed to the likely highly competi- to eventually replace its current high- tive nature of the congestive heart failure growth marketed products? Weinand told (CHF) market in future years by not starting analysts the company has 17 new products a Phase III study of the mineralocorticoid in Phase III and 18 in Phase II, including fi- receptor antagonist finerenone in the con- nerenone, vericiguat, vilaprisan and the dition, saying the decision was made for Bayer’s partial adenosine A1 agonist BAY 1067 197. “commercial reasons.” Marijn Dekkers The company also has ODM-201 in Phase Still, finerenone will continue to be III studies for non-metastatic castrate-resis- evaluated for use in the treatment of dia- tant prostate cancer, another anticancer betic kidney disease in an ongoing Phase ments for the two products. The diabetic anetumab in Phase II, and is evaluating its III study, reported Bayer’s outgoing CEO kidney disease indication was always the radiotherapeutics platform. And although Marijn Dekkers during a first-quarter ana- main driver of finerenone’s development, Bayer has not participated in the first wave lyst’s briefing held Apr. 26. while it has already been decided that of immune-oncology products, it expects The company said it would also only vericiguat would go into Phase III later this to be present during the next wave of such continue to evaluate in late-stage stud- year, in CHF patients with reduced ejection products, Weinand said. ies the guanylate cyclase (sGC) stimulator fractions, Weinand said. Analysts at Deutsche Bank noted the vericiguat in CHF patients with a reduced The answers didn’t completely satisfy pipeline rationalization announced will ejection fraction, and not those with a pre- analysts, who pointed out Novartis AG’s likely keep commentators focused on Bay- served ejection fraction. A Phase II study in Entresto (sacubitril plus valsartan) has been er’s plans for pipeline renewal that is likely patients with heart failure with a preserved considered to be a new gold standard in to include a combination of in-licensing, ejection fraction did not meet its endpoint, CHF for more than a year, and Bayer’s deci- acquisition and in-house projects. Credit Dekkers noted. Vericiguat is being devel- sion doesn’t appear to have been triggered Suisse analysts were more concerned, say- oped in a partnership with Merck & Co. Inc.. by more data. ing the pipeline update was a significant And because of the highly competi- fall-out from an already thin pipeline. tive nature of drugs being developed for Cancer Drugs In the 2016 first quarter, Bayer’s pharma- renal anemia, Dekkers said Bayer was also Discontinued ceutical sales increased by 12% to €3.9bn evaluating whether to proceed with Phase Other mid-stage pipeline products could ($4.4bn), driven by five recently launched III studies of the hypoxia-inducible factor- be discontinued by the company. A deci- products, Xarelto (rivaroxaban), Eylea prolyl hydroxylase (HIF-PH) inhibitor moli- sion to continue with the development (aflibercept), Stivarga (regorafenib), Xofigo dustat, or whether to find a development of the PI3K inhibitor copanlisib for non- (radium-223 dichloride) and Adempas (rio- partner or license it out. Top-line results of Hodgkin’s lymphoma will depend on the ciguat), whose sales in total amounted to Phase II studies with molidustat showed a results of Phase II studies that are running in €1.2bn, up 35% on the previous first quar- positive outcome, but a Phase III program parallel with Phase III studies, Dekkers said. ter and representing nearly a third of the would require larger outcome studies, the The Phase II data are expected in the third company’s pharmaceutical sales. Xarelto Bayer executive said. quarter of this year. gained market share and is the leading Analysts questioned why the competi- During the first quarter of 2016, Bayer anticoagulant worldwide, Eylea sales were tive landscape in heart failure was different has already decided not to pursue the de- up 49% on the previous first quarter, and for finerenone and vericiguat, with Bayer’s velopment of the investigation product Xofigo sales increased by 37%. During the pharma division head Dieter Weinand re- refametinib in cancer, and has returned the quarter, group sales increased by 3% at sponding by saying the decisions depend- project to Ardea Biosciences Inc.. The com- constant currencies to €11.9bn, led by its ed on the expected commercial environ- pany has also ended the development of life sciences businesses.

6 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

Continued from cover pipeline,” said Deutsche Bank analysts Panel: Pricing Dilemma Divides optimistically. Exane BNP Paribas analysts also conclud- Industry Stakeholders ed a Medivation acquisition could be a “sen- Lisa LaMotta [email protected] sible strategic deal” for Sanofi. “It would fill an earnings gap for Sanofi but not significantly rug pricing has become the most Life Years) and the UK healthcare system. improve the pipeline outlook, in our view,” contentious issue in the pharma I think access to new and innovative they added. world over the last two years as poli- treatments is more difficult and more The Exane analysts also claimed the D acquisition “could proceed independent- tics has dragged the subject into the main- challenging in the universal healthcare stream conversation. Yet, even those within system, because you don’t really pay for ly of the proposed Consumer/Animal the industry have different ideas on how the your healthcare. I think here, because of Health asset swap with Boehringer Ingel- problem can be fixed. the premiums and what families invest heim” (expected to close by end 2016), in their healthcare, they demand greater which will provide a €4.7bn cash influx access to more innovative medicine. You to Sanofi. have to have a way of assessing against the current US standard and not just the ‘An acquisition of bits you cherry-pick from other healthcare systems,” added Hudson, a Brit himself. this nature could, in Others at the conference emphasized one go, boost Sanofi’s the need for fixing the pricing dilemma as well. Betsy Nabel, President of Brigham and prostate cancer presence Women’s Hospital as well as a professor of medicine at Harvard Medical School, told and rejuvenate its the audience that she believes the problem needs to be handled by the stakehold- oncology pipeline’ ers in the private sector – swiftly. “As we think about pricing and how best to deliver for our patients, one solution is “Sanofi are likely to need to pay a high-

Shutterstock: Shutter_M Shutterstock: to ask the private sector to solve this. And er premium if they wish to acquire this why the private sector? Because you can company,” suggested the Exane analysts. Panelists from pharma, biotech, phar- make an argument that the market can “We believe other suitors may now step macy benefit managers and hospitals all come to a far better decision than the in. Medivation’s partner on lead drug expressed their views on the hot button government and government regulation,” Xtandi, Astellas Pharma Inc. would be an issue during the first day of the World she said. “The private sector – commercial obvious candidate.” Medical Innovation Forum on April 25 payers, academic medical centers, phar- Goldman Sachs analysts noted that Astel- in Boston – each viewing pricing from maceutical companies, biotech, venture, las had a “standstill” agreement restricting it a drastically different perspective and pharmacy – has to have a roundtable and from acquiring Medivation, “but according pushing their own agenda as the right fix this. It might be a difficult task, but we to Astellas this can be broken if there is an way forward. either sit down and sort this out together unsolicited bid” which now seems to have “The demand for breakthrough thera- or [the Centers for Medicare & Medicaid occurred. Pfizer Inc, AstraZeneca PLC and pies has never been greater. The demand Services (CMS)] is going to sort this out for AbbVie Inc. are also thought to be in the for medicines for smaller and smaller pa- us and we know the kind of record that running as potential bidders. tient populations has never been greater. CMS has.” Sanofi clearly would benefit from its Yet, the environment to deliver, the price Not all the panelists had such a shrewd proposed $9.3bn purchase of Medivation of value, has never been more constrained,” view of government regulation, but they based on the French company’s first quar- said Paul Hudson, Executive Vice President did see eye-to-eye on some things. “Ev- ter earnings, which show a pharmaceuticals of AstraZeneca PLC North America. erything we do, we look at through the business that’s suffering from competition, While Hudson expressed his frustration lens of the cancer patient. For patients, US drug pricing pressures and foreign cur- with the inverse relationship between de- survival is the key, but also quality of life, rency exchange issues. mand for better products and the price side effects. I totally agree with Betsy that the market will bear, he did note that this needs to be a multi-stakeholder ap- countries outside of the US have not yet proach, but we need to make sure that CLICK figured out how to best handle the issue the voice of the patient takes front and Read full story at: either. “You should be careful what you center,” added Gary Reedy, CEO of the http://bit.ly/1UvzVXb wish for with QALYs (Quality-Adjusted American Cancer Society.

scripintelligence.com 6 May 2016 | Scrip intelligence | 7 headline news

Lilly Executes Growth Strategy As New Products Drive Sales Gains Mandy Jackson [email protected]

espite late-stage clinical trial fail- glargine), and for the cancer therapies UK court ruled in favor of Allergan PLC ures and questions surrounding the Cyramza (ramucirumab) and Portrazza in February, allowing that company to Dcompany’s most closely-watched (necitumumab), were credited with pro- move forward with a generic version Phase III program, Eli Lilly & Co. is reaping the viding the majority of Lilly’s revenue of the drug in the UK, France, Italy and rewards of recent pipeline successes with growth in the first quarter. Spain. Another patent battle was lost in new products making up the largest share The company only began to ship the Germany in March 2015. of first quarter 2016 sales growth. newly-approved psoriasis therapyTaltz (ix- While Lilly continues to “actively defend” Lilly’s $4.87bn in first quarter revenue was ekizumab) to customers in April, so it did its Alimta patents, Mahoney noted that the essentially in line with analyst consensus of not shed light on early sales figures, but Lil- company’s financial guidance anticipates $4.8bn and non-GAAP earnings per share ly won EU approval for the biologic on April the entry of at least one generic competi- (EPS) of $0.83 missed expectations by two 25 and promotional efforts are expected to tor in Europe in 2016. Alimta sales slipped cents, but a positive showing for relatively begin in Europe in June. 2% in the first quarter to $564.2m. new products offered some hope for the Sales for Jardiance nearly doubled future and contributed to the company’s during the January-to-March period to Diabetes Remains Key decision to raise its revenue and earnings $38.2m from $19.3m a year earlier; Trulic- Business Segment, High guidance for the year. However, after the ity brought in $143.6m versus $18.3m; Growth Area Phase III failure of the cholesterol-lowering Basaglar generated $10.9m in first quarter Basaglar, Lilly’s version of Sanofi’s Lantus drug evacetrapib last year, all eyes are on sales; Cyramza grew 94% from $67.5m to (insulin glargine), won FDA approval in De- the Phase III clinical trial for the Alzheimer’s $131m; and Portrazza garnered $1.7m in cember, but the company will not market therapy solanezumab – Lilly’s next poten- first quarter sales. the product in the US until December of this tial mega-blockbuster product. Portrazza was approved in the US in No- year under a patent settlement agreement New therapies will contribute to Lilly’s vember in combination with gemcitabine with Sanofi. However, Lilly and partner Boeh- $20.6bn to $21.1bn in expected 2016 rev- and cisplatin to treat metastatic squamous ringer Ingelheim GMBH already are selling enue and $3.50 to $3.60 in non-GAAP EPS non-small-cell lung cancer (NSCLC) and the insulin copycat as Abasaglar in Europe. It for the year versus the company’s prior won EU approval for the same indication in also is available in Canada and Japan. guidance of $20.2bn to $20.7bn in rev- mid-February. While Cyramza won its first Jardiance sales are rising at a brisk pace enue and $3.45 to $3.55 in EPS. However, US FDA approval in April 2014 for gastric based on “game-changing” data from the Lilly said most of its greater expectations cancer and subsequent US indications for EMPA-REG cardiovascular outcomes trial for 2016 are based on reduced foreign ex- NSCLC in December 2014 and colorectal (CVOT), which were widely expected to change impacts and an improved tax rate. cancer (CRC) in April 2015, the VEGF recep- boost sales of Lilly’s drug and other SGLT-2 tor-targeting biologic was just launched inhibitors. In fact, Rice said the SGLT-2 class New Products Contribute in the EU during the first quarter to treat surged by 45% during the first quarter. To Growth locally advanced or metastatic NSCLC and “We continue to see regulatory approval But with new products making up 5% of metastatic CRC. of EMPA-REG OUTCOME data [later in 2016] Lilly’s 7% year-over-year increase in first However, Portrazza, Cyramza and Alimta as a catalyst for growth for both the class quarter revenue, it appears that the com- (pemetrexed) are facing competition in and for Jardiance. The other catalyst for pany is making efforts to meet the four big the US from immuno-oncology therapies growth is inclusion of these data in treatment guidelines,” he said, noting a favor- goals that executives first outlined in Janu- – the PD-1 inhibitors Opdivo (nivolumab) able guideline update in Canada during ary 2015. from Bristol-Myers Squibb Co. and Keytruda the first quarter. “We continue to make steady progress (pembrolizumab) from Merck & Co. Inc. Lilly has similar hopes for its GLP-1 recep- against each of our strategic objectives: Lilly Oncology President Susan Ma- tor agonist Trulicity, which is being studied driving revenue growth, expanding mar- honey said during the company’s earn- in a CVOT known as REWIND. Interim data gins, sustaining the flow of innovation, ings call that there will always be a need will be reviewed later this year and the trial and deploying capital to create value,” Lilly for the three therapies among certain will conclude in late 2018. Chief Financial Officer Derica Rice said dur- lung cancer patients, but for Cyram- ing the company’s earnings conference za, most of its growth is in gastric and call on April 26. colorectal cancers. CLICK Product launches for the diabetes New competition is particularly bad Read full story at: medicines Jardiance (empagliflozin),Tru - news for Alimta, which is facing pat- http://bit.ly/1W4qYF7 licity (dulaglutide) and Basaglar (insulin ent challenges in multiple markets. A

8 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

AstraZeneca Crows About Oncology Portfolio In 1Q; Strives For $1.1bn Cost Save Lucie Ellis [email protected]

straZeneca PLC is restructuring and streamlining its commer- 1Q In Numbers cial and manufacturing operations under a new cost-cutting Total revenue for 1Q16: $6.1bn effort in order to save $1.1bn annually from 2017 and focus A Core EPS for the quarter: $0.95 internally on just three core areas. The operational changes will incur a one-time restructuring Product sales for new oncology portfolio in 1Q16: $1.2bn charge of $1.5bn and will be completed by the end of fiscal year Total sales from growth platform (including respiratory portfolio, 2017. However, in the long run, the cash saved will be redirected Brilinta, diabetes portfolio, emerging markets, Japan and new oncology products): $3.4bn towards AstraZeneca’s oncology portfolio and for striking partnerships in “opportunity-led” parts of the company’s pipeline – such FY16 total revenue guidance: low- to mid-digit percentage decline as infection, neuroscience and inflammatory disease outside of FY16 EPS guidance: low- to mid-digit percentage decline the respiratory field. and we now have a tremendous number of exciting projects in oncology and specialty care… We’ve seen the need for us to invest more in oncology, to invest more in preparing all those launches and to invest in specialty care,” he said. Marc Dunoyer, executive director and chief financial officer, added that “In oncology we have one of the most exciting and bal- anced pipelines in the industry that we will further advance. But we plan to go faster and further.” The annual cost savings following the restructure are expected to be reflected primarily in AstraZeneca’s core SG&A figures from 2017. SG&A costs in 1Q16 declined by 6% to $2.1bn. The UK big pharma also reiterated its FY16 guidance and 2023 revenue target of $45bn. Pascal Soriot Eight Pipeline Terminations ‘We built our pipeline with In the first quarter of the year AstraZeneca suspended trials for eight of its products, including two Phase III studies. great success, in fact more than While four of the program suspensions were early stage, two Phase II and two Phase III trials have also been pulled from the com- we expected to, and we now pany’s R&D line-up. AstraZeneca noted that in 1Q 2016 it ended development of have a tremendous number of Brilinta (ticagrelor) in ischemic stroke after it failed to meet the exciting projects in oncology and primary endpoint of a Phase III outcomes study. Brilinta is already approved for the treatment of acute coronary syndrome specialty care’ and is in Phase III trials for atherosclerosis and peripheral arterial disease. Announcing the plans during the company’s first-quarter earn- A Phase III study testing Tagrisso (osimertinibin) in combination with ings call on April 29, CEO Pascal Soriot said, “We are further sharp- durvalumab as a second-line treatment for T790M mutation-positive ening our strategic focus on our main therapy areas, intensifying non-small cell lung cancer was also suspended in the first quarter our efforts in oncology and accelerating collaborations in oppor- due to safety concerns. Two trials had been paused in Oct. 2015 due tunistic areas. We are also driving greater efficiency across the -or to an increase in the incidence of interstitial lung disease-like reports. ganization to support the advancement of our strategy.” The company’s Phase III CAURAL study has now been terminated. As part of this cost-cutting action the company will concen- Tagrisso is already approved as a monotherapy for advanced non- small cell lung cancer (NSCLC). Meanwhile, in the first-line setting, trate on oncology, cardiovascular and diabetes programs inter- AstraZeneca’s FLAU- nally and pursue other therapy areas mainly through external RA trial for mono- CLICK partnerships. therapy Tagrisso in Click here to view all pipeline Meanwhile Soriot said AstraZeneca is at a “pivotal point” in its NSCLC is now fully terminations in 1Q16: evolutionary shift into more of a specialty care business. “We built recruited. http://bit.ly/1W4AHeP our pipeline with great success, in fact more than we expected to, scripintelligence.com 6 May 2016 | Scrip intelligence | 9 headline news

What’s On CEO Andrew Witty’s To-Do List Before Exiting GSK Jessica Merrill [email protected]

he company showed signs of stabilization in the first quarter, the board and management are very aligned on executing on the as Witty insisted his diversified strategy is beginning to pay company’s near-term strategy. T off. But a new CEO will have to contend with the potential “That’s one very key dimension of this equation, because when entry of Advair generics. you know what the strategy of the company is for the foreseeable GlaxoSmithKline PLC CEO Andrew Witty has a year left on the job, future then you can essentially look for somebody to execute that time he would like to use to convince investors his diversified strat- strategy and to build on it,” he said. egy is the right one for the company. The UK drug maker delivered 8% sales growth and an 8% increase in core earnings growth in the Defending Against Advair Generics first quarter, driven by vaccines and consumer health care – signs One of the challenges for any incoming CEO will be navigating that the strategy is gaining momentum. through the potential loss of the aging asthma drug Advair Diskus Pharmaceuticals sales fell 1% to £3.59bn ($5.22bn), but manage- (fluticasone/salmeterol) to generic competition. ment said the business is on track to return to growth in 2016, while Sales of Advair have been declining due to price pressure, and vaccines grew 23% and consumer health care grew 26% off of sub- newer respiratory drugs like Breo Ellipta (fluticasone/vilanterol) and stantially smaller bases. Anoro Ellipta (umeclidinium/vilanterol) haven’t picked up the slack. The company raised its guidance for the year slightly, targeting Sales of Advair slipped 19% in the first quarter to £753m ($1.1bn), core earnings-per-share growth of between 10% to 12% on a con- while sales of Breo picked up steam, up more than 100% to £111m stant exchange rate basis. ($161.4m) and sales of Anoro were just £33m ($48m). Sales of Nuca- Witty said delivering on the sales and earnings targets for the la (mepolizumab) – the first biologic to launch for the treatment of year is one of the top items on his list to complete before leaving patients with a severe form of asthma, eosinophilic asthma – were the company in early 2017. GSK announced in March that it is look- just £7m ($10.2m) in its first full quarter on the market. ing for a successor to Witty, who will retire in 2017 after nine years Meanwhile, GSK’s HIV business ViiV Healthcare has become an at the helm and 31 years at the company. important pillar propping up pharmaceutical sales. ViiV’s sales were The management transition comes as some investors have almost on par with Advair in the first quarter. HIV sales grew an become increasingly concerned about the company’s stagnant impressive 57% in the first quarter to £729m ($1.1bn), driven by growth and Witty’s emphasis on relying on businesses like vaccines the antiretroviral Tivicay (dolutegravir) and the combination pill Tri- and consumer health care to drive the enterprise while the phar- umeq (dolutegravir/abacavir/lamivudine). maceuticals business struggles. The big question for GSK now is whether a generic version of To deliver sales and core earnings growth in his last full year at Advair will be approved by FDA. Two generic drug manufacturers the firm, Witty said he will focus on successfully integrating the con- have confirmed they have filed abbreviated new drug applica- sumer and vaccines businesses acquired from Novartis AG last year. tions (ANDAs) for generic versions of Advair in the US: Mylan NV “It’s very important to me that we continue the momentum of and Hikma Pharmaceuticals PLC with user fee dates in the first our new products, to have 20% of our pharma business now com- half of 2017. There is no guarantee that FDA will approve the ap- ing from new products,” Witty said. “I want to keep those new prod- plications given concerns about the complicated delivery of re- ucts moving forward.” spiratory drugs. His other priority will be moving the pipeline forward. In “The question is going to be whether or not the generic comes, 2016/2017, Witty said there are roughly 30 Phase II clinical trials and how much of the generic comes, how switchable it is or it isn’t and 20 Phase III clinical trials slated to start. what volume they have,” Witty said. “I think all of that remains ex- “So there’s an awful lot that needs to be moved forward, and I tremely up in the air.” He also reminded investors that about £300m think we can really lay the foundation for that.” to £400m of US Advair sales comes from the metered-dose inhaler In terms of what might be the top priority for Witty’s successor, and not the dry powder and is therefore not open to switching. the chief executive responded to an analyst question that it will be Plus, within the Advair customer base, Witty said, “We have a lot left to that person to determine and likely will be driven in part by of people who it’s going to take a lot of persuading for them to the global environment. switch products.” “The world is focused on pricing. The world is focused on more GSK has already absorbed some of the impact, anyhow, because regulatory pressure and the volatility of global economics,” he said. of the pricing pressure Advair has experienced from payers in the “So I’m sure that’s going to be what drives the external agenda, but US. The upside, Witty said, is that it has started to move the prod- it will be up to them individually to set their own priorities.” ucts into a price range where generics could be less of a threat to GSK’s board of directors is evaluating both internal and external the brand. candidates to fill the job. “They are going to be looking for some- “I think we have a number of defenses to be able to maintain our body who punches a lot of tickets,” Witty said. Nonetheless, he said portfolio, which we’re obviously very much focused on,” Witty said.

10 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 business bulletin

Shire Outlines Baxalta Integration Strategy Amgen Earnings Beat Expectations Amgen Inc.’s first quarter revenue and earnings beat consensus estimates Overall, the Dublin-headquartered spe- without a meaningful contribution from sales of the cholesterol-reducing cialty firm reported product sales of biologic Repatha (evolocumab), but the company is pushing back against $1.627bn for the first quarter of 2016, payers that are denying reimbursement to appropriate patients. Thou- up 14% year-over-year. As usual, the top- sand Oaks, California-based Amgen reported on April 29 that it gener- seller was attention-deficit/hyperactiv- ated $5.5bn in first quarter 2016 revenue, which was 10% above the same ity disorder (ADHD) stalwart Vyvanse period in 2015 and $200m above consensus. The company also posted a (lisdexamfetamine), which posted 22% 17% jump in adjusted earnings per share (EPS) to $2.90, which was a $0.30 growth to $509m on the quarter. It also improvement over analyst expectations. But Repatha is expected to add was a strong quarter for Shire’s heredi- very little to the company’s sales tally before cardiovascular outcomes data tary angioedema franchise, as Firazyr are reported later this year, since US payers have refused to cover 77% of (icatibant) sales increased 39% to $128m prescriptions written for the PCSK9 inhibitor, even for patients who meet and Cinryze (C1 esterase inhibitor) sales the FDA’s requirements. Repatha sales during the first quarter totaled rose 11% to $164m. Initially launched $16m worldwide, including $14m in the US. Amgen’s competitor Sanofi as a hostile bid in mid-2015, Shire’s ac- was due to report its first quarter earnings on April 29, including sales for quisition of Baxalta was agreed upon the PCSK9 inhibitor Praluent (alirocumab), which it developed with Re- in January at a price of roughly $32bn, generon Pharmaceuticals Inc. Amgen executive vice president of global in a transaction that will leave Shire commercial operations Anthony Hooper said during the company’s April owning 66% of the combined company 28 earnings conference call that US cardiologists are frustrated, because and Baxalta 34%. Shire CEO Flemming many patients who could be appropriately treated with the biologic un- Ornskov said that if shareholder and der Repatha’s US FDA-approved label cannot get access to the medicine. regulatory approvals come through as Hooper noted that Amgen is talking to payers about making sure that pa- expected, the merger should close on tients who qualify for treatment are able to fill prescriptions. Repatha was or around June 3. He said the deal will specifically approved to lower low density lipoprotein cholesterol (LDL- bring Shire opportunities in hematol- C) in adults with heterozygous familial hypercholesterolemia (HeFH) or ogy, immunology and cancer. Shire in- clinical atherosclerotic cardiovascular disease (CVD) when statins alone do tends to follow the model of previous not lower LDL-C to recommended levels. It may also be prescribed to treat acquisitions to “leverage our existing homozygous familial hypercholesterolemia (HoFH) in combination with experience in the rare disease space to statins and other therapies. maximize the growth and value from these assets,” Ornskov stated.

Johnson, posted what Gonzalez termed where the money will be going in the “strong growth” to $381m on the quar- future. While immuno-oncology has AbbVie Gains Platform With ter. J&J reported first quarter sales of been a hot space for investors over Stemcentrx Buyout $281m worldwide, up from $116m in the last few years, some of venture the year-ago quarter. AbbVie hopes to capital heavyweights are looking for As part of its strategy to offset the com- continue its oncology expansion with new areas. A panel of the who’s who ing Humira patent cliff, AbbVie Inc. is the Stemcentrx play. The firm agreed to in biotech venture investing at the looking to oncology as a “significant pil- pay $2bn in cash and $3.8bn in stock for World Medical Innovation Forum in lar of growth” going forward, a gambit Stemcentrx, making it one of the high- Boston on April 26 told the audience CEO Richard Gonzalez says will benefit est valuations ever for a venture-backed that they are moving their money into greatly from both the pipeline candi- biotech takeout, along with up to $4bn dates and the solid tumor R&D engine newer areas these days. Amir Nashat, in regulatory and clinical development managing partner at Polaris Partners, his company will obtain in the $5.8bn milestones to Stemcentrx shareholders. purchase of Stemcentrx announced as well as the other members of the April 28. The transaction was unveiled panel, were optimistic that biotech in tandem with AbbVie’s first quarter investing is still going strong, even as earnings call, during which the company Panel: Investing Beyond IO the rest of the market has lagged in reported an 18.2% year-over-year increase Set To Heat Up 2016. Nashat also noted that immu- in net revenues to $5.96bn, with Humira no-oncology has given both investors (adalimumab) up 14.9% to $3.58bn. Panelists at the World Medical Inno- and the industry a new jolt of excite- The firm’s hematology assetImbruvica vation Forum discussed the new op- ment that is bringing money to the (ibrutinib), partnered with Johnson & portunities they are looking at and table elsewhere. scripintelligence.com 6 May 2016 | Scrip intelligence | 11 headline news

things to know about At the heart of significant non-compliance is an error 5 ICH GCP (R2) 2016 that matters in critical data or process, or a combination By CLARA HEERInG, VP CLInICAL RISK MAnAGEMEnT, ICOn Technology Oversight Significant updates to the ICH GCP guidelines, currently ment for a new risk management paradigm and the with paper as golden by investigators pending approval in draft form, not only harmonise the introduction of a revised framework that facilitates more 3 inspiration 4 conduct of clinical trials, in light of various regulatory future proof adoption of innovative technologies. CROs Enhanced oversight requirements will apply to investi- reforms by ICH member states, but also establish novel and Investigators will also be impacted by the guide- To encourage sponsors to adopt innovative technol- gators delegating tasks and investigator institutions de- forward-thinking standards. lines and need to take notice of what will be demanded ogies, the ICH GCP 2016 is introducing a new frame- ploying services to third parties. Sponsors and CROs will of them. work that resolves previous ambiguities in compliance need to consider how to enable effective and efficient These changes have broad implications for sponsors and requirements. This is a positive development since pre- support to sites in order to meet this oversight need. it is important that they are ready to adapt to the changes The most significant changes in draft ICH E6 (R2) are vious guidance sometimes stifles innovation. and embrace a shift in processes and behaviours. Most highlighted below, as they herald changes in the way The investigator and institution should also maintain importantly, sponsors need to be aware of the require- sponsors, CRAs and investigators currently operate. The source of this inspiration is paper management: the quality and control at all times of data and documents access control, data perenniality, and overall ALCOA provided to sponsors. principles of paper are the basis for the technology requirements. In the same way that corrections such as strike through and red notations are seen in ancient scriptures such as the 1200 year old Book of Kells, it will as well as observed errors need evaluation, management be essential that both the original source document and Risk Management and control; plans need to be adapted as necessary. at the core of Quality edits made are still clearly auditable in the future. Requirement 1 In terms of monitoring, the 2013 Risk and Quality Based The framework addresses three main concerns. First, it for sponsors to demonstrate Perhaps the most significant change in the upcoming Monitoring principles issued by the FDA and the EMA specifies requirements for the validity, longevity and 5 oversight of tasks delegated ICH GCP is the requirement to adopt risk management are combined in the new draft ICH GCP (R2); encour- fidelity of trial data as Sponsors transition from paper to CROs principles in a Quality Management System and in aging a risk based, quality by design combination of systems to digital records, update their digital systems, Monitoring. central and site monitoring in order to conduct clinical or change from one technology to another. Second, it ICP GCP (R2) 2016 requires that sponsors maintain over- trials with greater efficiency. encourages standard processes to avoid situations where sight of tasks delegated to CROs. Therefore CROs will Sponsors need to fulfil the principles of a Quality Man- real-time data aggregation and visualisation may inad- need to provide effective systems for transparency of agement System based on the risks and possible or de- At the heart of the approach is the determination of vertently influence trial outcomes inappropriately early data and tasks to enable effective sponsor oversight, and tected errors in critical data and processes. The Quality critical data and processes which drive risk governance, in the trial process. Finally, to resolve concerns that dig- sponsors will need to deploy oversight systems for tasks Management System is to incorporate the tenets of re- risk assessment, risk evaluation, risk management and ital trial databases can obscure unauthorized changes to assigned to third parties. cent risk and decision sciences, including decisions re- control, risk communication, adaptation to risk and primary data, the framework expands on the need for lated to tolerability of risk, as well as ALCOA communi- risk reporting. This has the potential to transform how control by investigator/institutions of their generated CROs deploying subcontractors will also need to firstly cation and record keeping. Anticipated risks and errors sponsors view monitoring processes in the future. ■ data and documents. seek the sponsor's approval on delegation.

12 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

of such errors, which lead to risks to human subject pro- Closing the Loop tection or reliability of study data. of significant non-compliance 2 Sponsors should consider the inclusion of human factor ICH GCP (R2) also includes the principle for sponsors analysis and classification system (HFACS) in their Root to address detected significant non-compliance through Cause Analysis systems. HFACS is the advanced level in root cause analysis, and prevention of reoccurrence. Root Cause Analysis and enables specific actionable outcomes; HFACS has a proven track record as the source of Outside of reporting, the addendum specifies three core significant safety improvements in e.g. the aviation in- distinct needs: significant non-compliance identifica- dustry. It enforces the identification of the Human Fac- tion, root cause analysis, and bespoke corrective and tor which led to the error, and helps to move away from preventive action. The currently predominant practice often irrelevant prevention methods such as ‘retrain of 100% source data verification (SDV) in monitoring the site’. For example, the solution to the human factor and ‘retraining of sites’ when issues are detected does ‘process’ source of recurrent incorrect centrifugation of not support these core requirements of the addendum, blood samples could be an improved label on the blood nor do many risk-based monitoring (RBM) initiatives. sample tubes rather than a retraining. things to know about At the heart of significant non-compliance is an error 5 ICH GCP (R2) 2016 that matters in critical data or process, or a combination By CLARA HEERInG, VP CLInICAL RISK MAnAGEMEnT, ICOn Technology Oversight Significant updates to the ICH GCP guidelines, currently ment for a new risk management paradigm and the with paper as golden by investigators pending approval in draft form, not only harmonise the introduction of a revised framework that facilitates more 3 inspiration 4 conduct of clinical trials, in light of various regulatory future proof adoption of innovative technologies. CROs Enhanced oversight requirements will apply to investi- reforms by ICH member states, but also establish novel and Investigators will also be impacted by the guide- To encourage sponsors to adopt innovative technol- gators delegating tasks and investigator institutions de- forward-thinking standards. lines and need to take notice of what will be demanded ogies, the ICH GCP 2016 is introducing a new frame- ploying services to third parties. Sponsors and CROs will of them. work that resolves previous ambiguities in compliance need to consider how to enable effective and efficient These changes have broad implications for sponsors and requirements. This is a positive development since pre- support to sites in order to meet this oversight need. it is important that they are ready to adapt to the changes The most significant changes in draft ICH E6 (R2) are vious guidance sometimes stifles innovation. and embrace a shift in processes and behaviours. Most highlighted below, as they herald changes in the way The investigator and institution should also maintain importantly, sponsors need to be aware of the require- sponsors, CRAs and investigators currently operate. The source of this inspiration is paper management: the quality and control at all times of data and documents access control, data perenniality, and overall ALCOA provided to sponsors. principles of paper are the basis for the technology requirements. In the same way that corrections such as strike through and red notations are seen in ancient scriptures such as the 1200 year old Book of Kells, it will as well as observed errors need evaluation, management be essential that both the original source document and Risk Management and control; plans need to be adapted as necessary. at the core of Quality edits made are still clearly auditable in the future. Requirement 1 In terms of monitoring, the 2013 Risk and Quality Based The framework addresses three main concerns. First, it for sponsors to demonstrate Perhaps the most significant change in the upcoming Monitoring principles issued by the FDA and the EMA specifies requirements for the validity, longevity and 5 oversight of tasks delegated ICH GCP is the requirement to adopt risk management are combined in the new draft ICH GCP (R2); encour- fidelity of trial data as Sponsors transition from paper to CROs principles in a Quality Management System and in aging a risk based, quality by design combination of systems to digital records, update their digital systems, Monitoring. central and site monitoring in order to conduct clinical or change from one technology to another. Second, it ICP GCP (R2) 2016 requires that sponsors maintain over- trials with greater efficiency. encourages standard processes to avoid situations where sight of tasks delegated to CROs. Therefore CROs will Sponsors need to fulfil the principles of a Quality Man- real-time data aggregation and visualisation may inad- need to provide effective systems for transparency of agement System based on the risks and possible or de- At the heart of the approach is the determination of vertently influence trial outcomes inappropriately early data and tasks to enable effective sponsor oversight, and tected errors in critical data and processes. The Quality critical data and processes which drive risk governance, in the trial process. Finally, to resolve concerns that dig- sponsors will need to deploy oversight systems for tasks Management System is to incorporate the tenets of re- risk assessment, risk evaluation, risk management and ital trial databases can obscure unauthorized changes to assigned to third parties. cent risk and decision sciences, including decisions re- control, risk communication, adaptation to risk and primary data, the framework expands on the need for lated to tolerability of risk, as well as ALCOA communi- risk reporting. This has the potential to transform how control by investigator/institutions of their generated CROs deploying subcontractors will also need to firstly cation and record keeping. Anticipated risks and errors sponsors view monitoring processes in the future. ■ data and documents. seek the sponsor's approval on delegation.

scripintelligence.com 6 May 2016 | Scrip intelligence | 13 headline news

Ironwood Buys AstraZeneca’s Zurampic As Ideal Linzess Complement Joe Haas [email protected]

hat was AstraZeneca’s trash is The deal divests AstraZeneca of the key Divestment Motivated now Ironwood’s treasure, as it asset from its 2012 $1.26bn buyout of Ar- By Focus, Not Safety, W pays $100m up front, along with dea, although the pharma retains rights Ironwood Claims milestones and royalties, to acquire gout to other pipeline assets it acquired in that Asked on the call why AstraZeneca drug approved in December, but not yet transaction. Ironwood, however, does get would divest a recently approved asset launched. an option on a follow-on gout compound for which it paid a premium price just discovered by Ardea, RDEA3170, in Phase II. four years ago, Hecht asserted the phar- Ironwood will pay $100m up front for US ma’s decision was more about strategic rights to all products containing lesinurad, focus on immuno-oncology than on get- along with up to $165m in milestone fees, ting rid of a drug with a questionable which Hecht said are largely contingent safety profile. upon commercial success. AstraZeneca “The development program was very also will get single-digit sales royalties on strong,” he said on the call. “The regulatory product sales under the deal. The pharma package was very strong. They did a fabu- will manufacture and supply Zurampic to lous job negotiating what I think is really a Ironwood, provide undisclosed product quite good label that effectively captures support services and retain responsibility the benefit and the risk in the product for a postmarketing study of the drug for well. And ... they prepared a terrific launch renal and cardiovascular safety that is due package in every level, from marketing

Shutterstock: Kritchanut Shutterstock: by 2025. materials to medical affairs. I think at the Zurampic was approved as a once-daily, strategic level, AstraZeneca is moving Ironwood Pharmaceuticals Inc. has been 200mg oral tablet. It is the first inhibitor very strongly – they’ve been quite public looking to acquire an on-market or market- of uric acid transporter URAT1 approved about it – toward immuno-oncology and ready product to pair commercially with its for gout, and the first product approved their three core strategic areas. And pri- gastrointestinal drug Linzess (linaclotide), in roughly 60 years for treating insufficient mary care isn’t one, [so] this is an outside and it thinks it hit that target at very rea- excretion of uric acid. But the drug faced of the core area.” sonable terms in acquiring the unlaunched problems with the safety profile and was Ironwood cited market estimates that gout drug Zurampic (lesinurad) from Astra- submitted at a lower dose, which had less about 4m Americans are being treated for Zeneca PLC. efficacy. FDA’s Arthritis Drugs Advisory gout with XOI agents, and that roughly half In a deal announced April 26, the Cam- Committee supported the clinical benefit of those have uncontrolled disease. This bridge, Mass.-based company said Zuram- but was mixed on the safety profile. leaves a market opportunity for Zurampic pic – approved by the US FDA on Dec. 22, The indication is for second-line, com- of about 2m patients who are highly moti- but not yet launched – offers the chance bination therapy with a xanthine oxidase vated to alter their treatment to reduce suf- to target many of the same primary care inhibitor (generic allopurinol or Takeda fering and doctors who are very open to physicians now being contacted for Linz- Pharmaceutical Co. Ltd’s Uloric (febuxo- the potential added benefits of Zurampic’s ess and will leverage its existing commercial stat) in patients with hyperuricemia associ- mechanism of action. operation without great additional expense. ated with uncontrolled gout who have not Hecht called the addition of Zurampic AstraZeneca had held off on launching the achieved target serum uric acid levels with to Ironwood’s portfolio “a great strategic fit,” drug, which doesn’t fit into its core areas and XOI monotherapy. The FDA label includes a noting that uncontrolled gout is a similar doesn’t have the ideal profile, as it considered black box warning that acute renal failure opportunity to irritable bowel syndrome prospects for “externalization.” has occurred in Zurampic clinical trials and with constipation and chronic idiopathic Ironwood plans to launch Zurampic was more common when the drug was constipation, which are being addressed around the midpoint of the second half given alone . with Linzess. of this year, CEO Peter Hecht said during a FDA required the sponsor to conduct a “Critically, this transaction enables us to same-day investor call, and looks forward to postmarketing study of the drug’s impact, in further leverage Ironwood’s demonstrated the anticipated late 2016 filing and 2018 ap- combination with background XOI therapy, commercial capability,” the exec said. “It proval of a fixed-dose combination of lesinu- on renal function, adverse renal events and provides the opportunity to maximize and rad and another gout drug, allopurinol, that an independent assessment of cardiovascu- strengthen our sales capability by expanding will be transferred over by AstraZeneca under lar safety based on adjudication of prospec- our primary care coverage, focusing on top the agreement. tively defined and collected CV events. prescribers and early adopters.”

14 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

Data Trumps Anecdotes, Emotion At Sarepta Panel donna young [email protected]

t a highly charged April 25 meeting have heard testimony from patients that they eteplirsen induced production of dystro- of the FDA’s Peripheral and Central didn’t think that would alter the level of effort phin – a protein essential for normal mus- ANervous System (PCNS) Advisory that people made.” cular structure and function and the lack of Committee, which concluded with angry “So those kinds of factors are certainly which is at the heart of DMD – to a level that shouting from parents and patient advo- things that are up for discussion,” Temple said. is reasonably likely to predict clinical benefit. cates, a majority of panelists said Sarepta While “a lot of people don’t like historically In other words, the committee voted Therapeutics Inc. failed to provide sufficient controlled trials,” he said those types of stud- against an accelerated approval of eteplirsen. efficacy data for its Duchenne muscular dys- ies “can be an adequate and well controlled.” The initial vote on that question was 8-5, trophy drug eteplirsen to win US approval – Ellis Unger, director of the FDA’s Office of but one panelist, Paul Romitti, a professor of accelerated or standard, although the votes Drug Evaluation I, told PCNS members they epidemiology and toxicology at the Univer- were much closer on the former than on the had to “try to reconcile what you heard from sity of Iowa, said he’d “hit the wrong button,” latter question. the patients” with the “actual hard data you’ve and voted “no” when he meant to vote “yes,” Now, though, it’s up to the FDA on whether been analyzing today.” so the change made it an even tighter split it will take that advice – with all eyes on Janet But it was the comments from one com- among the PCNS panelists – something that Woodcock, director of the Center for Drug mittee member, Chiadi Onyike, an associate may give Woodcock some leeway to work Evaluation and Research, who on more than professor of psychiatry and behavioral sci- with if she’s truly inclined to get eteplirsen one occasion during the more than 11-hour- ences at Johns Hopkins University in Balti- to patients sooner rather than later, as some long meeting emphasized that even though more, that stirred outrage from the audience analysts have speculated. the statutory standard for efficacy was clear, of patients and parents. The committee voted 7-5, with one ab- the agency has some flexibility, particularly Onyike insisted Sarepta’s 12-patient study stention, the decisions to administer the when it comes to a rare, life-threatening dis- failed on “scientific grounds” to prove efficacy 6-minute walk test, versus conclusions that ease like DMD, a progressive muscle degen- and the anecdotal testimony from patients the patient could no longer walk, failed to erative condition that primarily affects boys, and parents during the open public hearing be sufficiently objective and free of bias and who often don’t live beyond 30 years. “wasn’t properly measured in the study.” subjective decision-making by patients, their Indeed, Woodcock even pointed out the So, Onyike said, “I hope you would consider caregivers or their health care profession- FDA has been “instructed” to take the pa- as a patient community participating fully in als to allow for a valid comparison between tient community’s views into account when controlled trials so you are not in this position patients in Study 201/202 and an external asked by one PCNS panelist whether the in the future” – remarks that drew immediate control group. committee should consider the testimony fire from Duchenne advocates. A majority of the panel said they believed they heard at the meeting from the more Sarepta management had explained the there was no effect of North Star Ambulatory than 50 people, including young boys with reason they hadn’t conducted a placebo- Assessment results on the persuasiveness of Duchenne who participated in Sarepta’s trial, controlled trial for eteplirsen was because at the findings in Study 201/202. or were not able to do so, their parents and the time they launched the 12-patient study, An even greater number of the commit- other advocates, including a member of there wasn’t enough of the drug manufac- tee said they thought there was no effect Congress, Rep. Mike Fitzpatrick (R-PA), who tured. And by the time there was a larger of the other tests of physical performance, pressured regulators to approve eteplirsen, supply of the experimental medicine, pa- like rise time or the 10-meter run or walk, noting he carried a letter with him signed by tients already heard reports about its efficacy on the persuasiveness of the findings in the 108 of his Capitol Hill colleagues. and so it became “unfeasible” since no patient Sarepta trial. Earlier in the day, Woodcock even sug- wanted to risk getting the placebo. For the final question, the panel voted 7-3, gested it may be worse for the FDA not to But Sarepta leaders pointed out the firm with three abstentions, the clinical results approve a drug for a “devastating” disease has a confirmatory Phase III trial, known as of Sarepta’s s single historically-controlled that’s actually effective – declaring the conse- PROMOVI, underway, which plans to enroll study failed to provide substantial evidence quences would be “extreme” for patients – al- up to 80 patients with genetic deletions that eteplirsen was effective as a treatment though she emphasized regulators were still amenable to correction by exon 51 skipping for DMD. grappling with eteplirsen’s efficacy benefit. in the treatment arm and 80 in the untreated Billy Dunn, director of the FDA’s Division of Robert Temple, deputy director of the FDA’s group not amenable to exon 51 skipping. Neurology Products, noted the “emotion and Office of Drug Evaluation I, noted that while Analysts, however, questioned whether passion in the room was clear” and tried to regulators had raised a lot of questions about that trial would satisfy the FDA. reassure the patients and parents at the PCNS Sarepta’s single trial, known as Study 201/202, meeting “we listened carefully” to their testi- with specific concerns about whether there Votes mony and would take the information “under was “improper influence” – pointing out the The PCNS voted 7-6 that Sapreta had failed serious consideration.” difficulty of controlling bias in historical con- to provide substantial evidence from ad- The panel’s rejection was just the latest trol studies – he also told panelists they “may equate and well-controlled studies that blow to the DMD community. scripintelligence.com 6 May 2016 | Scrip intelligence | 15 headline news

Court: No Herceptin Biosimilar Tag For Indian Trastuzumabs Anju Ghangurde [email protected]

n Indian court appears to have de- ket and advertise their product under their protocol” for biosimilars and, therefore, their livered a frontal blow to defendants respective brand names based on the ap- drugs cannot be considered biosimilars. “We ABiocon and Mylan in a hotly contest- provals already granted but without calling took this action because as the holder of ed case concerning their biosimilar versions their product as “bio similar and/or biosimi- the Herceptin trademark and innovator of of Roche’s Herceptin (trastuzumab). lar to Herceptin, Herclon, Biceltis” or in any trastuzumab, we have a duty to ensure that The court has, in an interim ruling, sug- way ascribing any bio-similarity with that of if a company claims its product is a biosimilar gested that the regulatory approvals for the Roche’s products in any press releases, pub- of, or similar to our innovator product, then biosimilars may not have been aligned with lic announcements, promotional or other in it actually satisfies the criteria for a biosimilar.” Indian guidelines for such products and printed form and from relying upon or refer- Biocon, though, underscored that the that both Biocon and Mylan can keep their ring the plaintiffs’ names. court judgment does not restrict the sale and drugs on the market but can’t call them The Delhi High Court, in an interim order manufacture of its trastuzumab, “which is in biosimilar to Herceptin. The court even put dated Feb. 5, 2014, restrained both Biocon the interest of patients.” forth an option for Biocon to reapply for its and Mylan from “relying upon or otherwise “However, we understand it has some ob- license should it wish to claim biosimilar as referring to” Roche’s Herceptin and its sec- servations with respect to packaging and la- a description of its product or part of its pro- ond brands Herclon or Biceltis, or any data belling, which we will address appropriately. motional campaign. relating to trastuzumab marketed as the CANMAb has undergone all applicable com- three brands cited. parability studies,” the Indian firm said. Judge Singh said that Biocon and Mylan It also added that it had just received the It’s not clear if the may manufacture and market the drug by copy of the interim order which it was study- interim ruling could qualifying the INN name trastuzumab but ing and will examine all options. not use the name stand alone on the carton “The current judgment will not affect our have any ripple effects or package insert as a brand name. product portfolio,” Biocon said. “The defendants can use the INN name as It’s not immediately clear if the interim rul- on other biosimilar Biocon’s trastuzumab or Mylan’s trastuzumab ing could have any ripple effects on other biosimilar trastuzumabs approved or in the trastuzumabs wherever applicable to describe the com- position of molecule on the product as well approval stage. approved or in the as in its insert and not in a prominent man- ner. The said expression shall be used at the Re-apply approval stage bottom part of the carton and should be in Interestingly, Judge Singh also put forth an small size letters than their respective brand option for Biocon suggesting that if it in- names,” details in the 227-page order added. tends to claim biosimilar as a description of The high-decibel case in the Delhi High Judge Singh also restrained Biocon and its product or part of its promotional cam- Court pitching plaintiff Roche against the Mylan from using the data relating to man- paign or otherwise in any other form, it can, Drugs Controller General of India (DCGI) and ufacturing process, safety, efficacy and tests if so advised, “re-apply the license” before partners Biocon Ltd. and Mylan NV has seen conducted for the safety of the drugs as the relevant authorities including the DCGI. a string of allegations and counter-allega- complained of by Roche till the time the fi- In such an event, the court said that the tions so far, including Biocon’s reference to nal decision on the issue of the biosimilarity DCGI and the authorities and committees Roche’s attempts to act as a “super regulator.” is made in the suit. This is in view of “prima framed therein should decide the approval In an interim order dated April 25, Judge facie findings” that the use of the data by application in accordance with the Rules Manmohan Singh said that he was of the the defendants in the product insert with- and Guidelines of 2012 and also the obser- view that the approvals granted to [Biocon’s out undergoing the entire process of the vations made by the court in the present ] CANMAb and [Mylan’s] Hertraz are “not on trials is “misleading.” order. Alternatively, Biocon could await the the basis of the adherence” of the Guide- Roche said that the ruling sends a “strong, outcome of the present suit and can con- lines of 2012 [on Similar Biologics] and rules positive” signal that the development, manu- tinue with the present arrangement as an interim measure, it added. framed under the [Indian] Drug Act. The fi- facture and approval of biosimilars in India nal finding in this respect, he though main- must be subject to “rigorous” clinical and reg- tained, is yet to be arrived after the present ulatory standards as per the applicable law. CLICK suit is heard on completion of the trial. It noted that the court had made clear Read full story at: The court also specified that Biocon and that the approvals granted to the compa- http://bit.ly/21iZw6o Mylan may continue to manufacture, mar- nies “are not in accordance with the existing

16 | Scrip intelligence | 6 May 2016 © Informa UK Ltd 2016 headline news

Acadia’s Nuplazid OK’d; A Billion Dollar Parkinson’s Drug? Donna Young [email protected]

he FDA on April 29 approved Aca- dopamine receptors, therefore, not impair- with known QT prolongation or in com- dia Pharmaceuticals Inc.’s Nuplazid ing motor function in patients with PDP. bination with other drugs known to pro- T (pimavanserin) as the first product Nuplazid’s application was based on long QT interval, including Class 1A an- in the US treat hallucinations and delusions data from the pivotal Phase III trial, known tiarrhythmics or Class 3 antiarrhythmics, associated with Parkinson’s disease psycho- as Study -020, and other supportive stud- certain antipsychotic medications, and sis. The medicine has the potential to be the ies, which Acadia said represented the larg- certain antibiotics. company’s first billion dollar product. est research and development program in Nuplazid also should be avoided in With the FDA’s approval in hand for Nu- the PDP space. Nuplazid significantly re- patients with a history of cardiac arrhyth- plazid (pimavanserin), Acadia Pharmaceuti- duced the frequency and severity of psy- mias, as well as other circumstances that cals Inc. now will put its efforts into market- chotic symptoms, versus placebo, on the may increase the risk of the occurrence ing the drug, which has the potential to be scale for assessment of positive symptoms of Torsade de pointes or sudden death, the company’s first billion dollar product. of Parkinson’s disease, or SAPS-PD. That including symptomatic bradycardia, hy- The medicine, which Acadia plans to benefit was achieved without impairing pokalemia or hypomagnesemia, and put on the US market in June, is the first motor function, Acadia reported. presence of congenital prolongation of product approved in the US to treat hal- The most common adverse reactions of the QT interval. But analysts don’t think lucinations and delusions associated with 5% or greater and twice the rate of placebo the black box or other warnings will get Parkinson’s disease psychosis (PDP). in the study were peripheral edema and in the way of Nuplazid’s sales, given the Before the FDA’s gave its blessing to confusional state. unmet need for the medicine, which in Nuplazid, analysts at Sagient Research’s As an atypical antipsychotic drug, Nupla- 2014 was dubbed a breakthrough therapy BioMedTracker, an affiliate of Scrip, put the zid’s labeling must carry a black-box warn- by the FDA – a designation intended to chances of approval at 94%. ing alerting prescribers and patients about help speed products for life-threatening Acadia has not yet disclosed the pricing an increased risk of death associated with conditions to the market. for Nuplazid, but the company plans to hold the use of those types of drugs to treat old- Nuplazid was overwhelmingly backed a conference call with investors and analysts er people with dementia-related psychosis. by an FDA advisory committee. on May 2, where more details may become The boxed warning also emphasizes that At a March 29 meeting, the FDA’s Psy- available. But Acadia said it plans to launch a no drug in the atypical antipsychotic class chopharmacologic Drugs Advisory Com- financial and patient access assistance pro- is approved to treat patients with demen- mittee (PDAC) voted 12-2 Nuplazid’s ben- gram, known as Nuplazidconnect. tia-related psychosis. efits of about a 23% improvement in PDP Nuplazid will only be available through Other sections of the labeling warn that symptoms, which the FDA called “minimal,” a specialty pharmacy network, Acadia Nuplazid should be avoided in patients outweighed its risks of serious adverse said. Nuplazid is the first selective inverse events, like cardio-respiratory arrest, heart agonist of the 5-hydroxytryptamine 2A attacks, respiratory distress, sepsis and sep- (5-HT2A) receptor approved in the US for tic shock, or death. Parkinson’s and as such has established a “I was persuaded by the really terrible qual- new class of medicines: selective serotonin ity of life that these patients have,” said PDAC inverse agonists. chair David Brent, academic chief in the Di- The drug not only preferentially targets I was persuaded by vision of Child Adolescent Psychiatry at the 5-HT2A receptors, which are thought to University of Pittsburgh School of Medicine play an important role in PDP, but it also the really terrible in Pennsylvania. “I think as long as they can avoids activity at dopamine and other re- quality of life that be given an informed choice about the risks, ceptors commonly targeted by antipsy- I think they ought to have the option.” chotics. these patients have. Brent said he also was convinced “by the Typical therapies for Parkinson’s, which fact there really is nothing else.” affects about 1 million Americans and up I think as long as “Even if the effects are modest, you have to 6 million people worldwide – with about they can be given to compare it to what’s available right now, 40% having PDP – consists of drugs that which with what we’ve been presented is stimulate dopamine to treat patients’ motor an informed choice nothing,” he said. symptoms such as tremor muscle rigidity In two earlier questions, the committee and difficulty with walking. But, explained about the risks, voted 12-2 that Acadia provided substan- Michael Okun, medical director of The tial evidence of the effectiveness for Nu- National Parkinson Foundation, Nuplazid they ought to have plazid as a treatment for PDP and 11-3 the works in a “whole new way” – treating hal- the option company had adequately characterized lucinations and delusions without blocking the safety profile of the medicine. scripintelligence.com 6 May 2016 | Scrip intelligence | 17 headline news

Erbitux Being TAILOR-Made For Chinese First-Line mCRC Market, But Brand Recognition Is Merck’s Real Goal Alex Shimmings [email protected]

erck’s plans to penetrate the Chinese market further with its anti-EGFR cancer therapy Erbitux (cetuximab) have re- Mceived a boost with a Phase III TAILOR trial showing significant benefits when used first-line in metastatic colorectal cancer in this population. The German company says it will work to make the product available for patients in China as a first-line treatment as soon as possible. But it seems that the real benefit for the German company of any label expansion will be in helping it build its brand presence in China rather than in absolute sales. Erbitux was first approved in China for use in combination with irinotecan or as a single agent for metastatic colorectal cancer refractory to irinotecan in 2006, but the standard first- and second-line regimens for colorectal cancer there are FOLF- OX and FOLFIRI. An expanded approval in China would bring it into line with other major markets. First-line treatment of RAS wild-type metastatic

colorectal cancer with Erbitux plus FOLFOX or FOLFIRI is already areeya_ann Shutterstock:

patents expire, and counterfeit drugs continue to be a significant ‘Merck is likely trying to break into problem in the Chinese market,” said Phan. the Chinese market where brand “Ultimately, I really see the results of this study (and the likely resulting label expansion) as an opportunity for Merck to establish recognition is an important factor’ a presence in the Chinese market. Roche is currently the biggest presence in the Chinese CRC market with Avastin, and Merck is likely trying to break into the Chinese market where brand recognition recommended in clinical guidelines by both the US National Com- is an important factor,” he added. prehensive Cancer Network and the European Society for Medical The top-line data from the 397-patient TAILOR study show that Oncology clinical guidelines. it met its primary endpoint of significantly increasing progres- But such a label expansion to first-line use is unlikely to do sion-free survival (PFS) in patients with RAS wild-type metastatic much for the product’s global sales, says Datamonitor Healthcare colorectal cancer (mCRC) treated with Erbitux (cetuximab) plus analyst Dr Dustin Phan. “Not only are both regimens effective and FOLFOX chemotherapy, compared with FOLFOX alone. widely used for colorectal cancer globally, but Erbitux recently Secondary endpoint results also support the superiority shown failed to receive a recommendation from NICE for first-line use for PFS, Merck said, and the safety profile was similar to that seen due to its lack of cost-effectiveness. It’s hard to imagine that a in other pivotal trials. Secondary endpoints include overall survival, cost-conservative national healthcare system like China’s would best overall response rate, time to treatment failure and rate of cu- not make a similar assessment. This would then limit the drug’s rative surgery for liver metastases. first-line use in China to RAS wild-type mCRC patients with private The full study results will be submitted to upcoming internation- insurance or self-funding. Merck has charity assistance schemes in al scientific meetings. place to promote the use of the Erbitux. Under these programs, “This marks a significant step in the execution of our strategy patients will have a self-pay period of three months as opposed in oncology, notably the expansion in growth markets like China,” to six months. However, the relative high-cost of treatment for the said Luciano Rossetti, head of global research and development of majority of the Chinese population will still limit the drug’s peak Merck’s biopharma business. They “reinforce the value and impera- patient share.” tive of RAS biomarker testing in clinical practice, so as to provide Another problem for Merck is that Erbitux is also expected to patients with the right targeted therapy,” he added. experience loss of patent exclusivity in China in the second quar- Merck has a keen interest in China. As well as tapping into local ter of 2017, which will result in biosimilar competition and erosion innovation by nurturing Chinese start-ups, it has been strengthen- of branded sales, with the first cetuximab biosimilars expected to ing its own presence in recent years in China. China has the world’s reach the market in 2020. “In addition, many branded drugs are second-largest single pharmaceutical market with an estimated extensively copied by domestic generics companies before their annual growth rate of about 9% through to 2018.

AbbVie Partnership On CD71 Gives CytomX Big Upfront Gilead Gets CHMP Nod for New Antibody-drug conjugates have taken HIV Combo a back seat to cancer immunotherapy Gilead has received the green light in the EU for marketing its newest fixed- as the hot modality in oncology of late, dose HIV treatment Odefsey but its cannibalization of predecessor product but AbbVie Inc. and CytomX Therapeu- Complera will not reach levels expected in the US as generic versions of older tics Inc. unveiled a partnership on April HIV combos are set to arrive earlier in the EU. The EU’s CHMP has given Gile- 20 to develop an ADC in a deal that Cy- ad Sciences Inc. the go-ahead for the marketing of its new fixed-dose combina- tomX cites as further validation of its tion HIV treatment Odefsey (emtricitabine 200 mg/rilpivirine 25 mg/tenofovir Probody technology platform. AbbVie alafenamide 25 mg; R/F/TAF). The product is fixed-dose combination of 200 is paying $30m up front to co-develop mg of Gilead’s emtricitabine, 25 mg of its tenofovir alafenamide with 25 mg of and potentially co-commercialize a Janssen-Cilag Ltd.’s (Johnson & Johnson) rilpivirine, and is the latest product Probody-drug conjugate against CD71, in the two companies’ development and commercialization agreement, which also known as transferrin receptor 1 produced the predecessor product Eviplera/Complera (rilpivirine/emtricit- and highly expressed in a number of abine/tenofovir disoproxil fumarate). The tenofovir alafenamide (TAF) com- solid and hematologic cancers. Unlike ponent is a new tenofovir prodrug that has similar efficacy to tenofovir diso- prior deals around the Probody plat- proxil fumarate (Gilead’s Viread or TDF) at one tenth of the dose. Gilead also form with Pfizer Inc. and Bristol-Myers notes that TAF has also shown improvement in surrogate laboratory markers Squibb Co., CytomX will have greater of renal and bone safety compared with TDF in clinical trials in combination involvement in this partnership, with with other antiretroviral agents. responsibility for development through the end of Phase I and a right to either co-commercialize in the US or share US guidance allows a flexible approach to profits. The deal was the third cancer- be taken to the development of new focused tie-up AbbVie announced dur- antibiotics for human use, targeting Biogen’s Zinbryta Gets ing the week of April 18. multi-drug resistant pathogens in ar- EU Nod eas where treatments are needed. Biogen and AbbVie Inc.’s multiple scle- AZ’s Zavicefta Gains rosis therapy, Zinbryta (daclizumab), has been given a green light for use in EU Positive Opinion Bristol Getting Opdivo Lung Europe – but what gap can this new The CHMP followed recent EMA guid- Data Earlier Than Expected drug fill in a crowded therapy space? ance to take a flexible approach to Zinbryta received a positive recom- Bristol-Myers Squibb Co. is moving drugs against multi-resistant patho- mendation from the European Medi- up the timing on its eagerly awaited gens when recommending approval cines Agency’s scientific committee, for AstraZeneca’s latest antibacterial CheckMate-026 first-line lung cancer the CHMP, following its April 25-28 Zavicefta. AstraZeneca PLC’s new an- trial of Opdivo, with data now expected meeting, based on data submitted tibacterial, Zavicefta (ceftazidime plus in the third quarter – earlier than prior from the Phase IIb SELECT and Phase avibactam), has been recommended guidance. With indications in mela- III DECIDE trials of the drug in relaps- for approval in the EU by the top advi- noma, second-line lung cancer and sec- ing forms of MS (RMS). The CHMP sory panel, the Committee for Medici- ond-line kidney cancer under its belt, noted that benefits of the drug are nal Products for Human Use (CHMP), the PD-1 inhibitor had sales of about its ability to reduce the annualized for use in the treatment of patients $1bn in 2015, at the forefront of suc- relapse rate (ARR), as well as the risk infected with multi-drug resistant cessful oncology launches. In the first of 24-week confirmed disability pro- bacteria, so-called “superbugs,” as well quarter, Opdivo brought in $704m in gression. However, analysts at Sagient as several other severe bacterial infec- sales, Bristol reported April 28. And the Research’s BioMedTracker previously tions. The committee recommended product continues to grow into new noted that while Zinbryta in the Phase approval for infections caused by indications – in April, FDA granted III DECIDE trial did show efficacy multi-drug resistant pathogens on the Opdivo breakthrough designation for superior to that of interferon beta-1a basis of a limited set of data, but this second-line treatment of metastatic with regard to the annualized relapse was in line with guidance from the head-and-neck cancer and the agency rate and lesions, the drug was not as- European Medicines Agency (EMA) is- accepted a filling in classical Hodgkin sociated with a significantly lower risk sued in 2013, the agency noted. That lymphoma after prior therapies. of disability progression. scripintelligence.com 6 May 2016 | Scrip intelligence | 19 EXCLUSIVE INTERVIEW

Heptares-Powered Sosei’s Incoming CEO Explains What Happens Next Sukaina Virji [email protected]

Japanese company Sosei conducted a master stroke last year when it acquired UK biotechnology company Heptares as its in-house R&D engine. Deal after quality deal has ensued, and Sosei’s share price has rocketed by more than 400%. Scrip’s Sukaina Virji spoke to Sosei’s COO – and CEO-elect – Peter Bains to find out what happens next. Peter Bains After almost six years as a non-executive member of Sosei Group Scrip: Sosei’s share price has rocketed over the past 12 months Corp.’s board and one of the key architects of Sosei’s long-term strate- so obviously investors are happy. Has Heptares lived up to your gic vision, Peter Bains was appointed Sosei’s COO at the start of April. If expectations? all goes to plan, he will take over the CEO role from company founder Peter Bains: When we looked at it just over a year ago we were and chair Shinichi Tamura at the AGM in June this year. very excited by what we saw as a world leading technology around GPCR targeted structure based drug design and receptor stabilizing Scrip: What attracted you to the CEO role at Sosei? technology. With stabilized receptors you get the very high resolution Peter Bains: I was brought in as a non-executive to strengthen crystals and that is what you need to drive a pipeline of high quality the strategic and operational mix on the Sosei board almost six candidates that can move into preclinical development and then into years ago. It was then a small company and today it’s still a small clinical development and beyond. company. We have 110 people. In that context, the board plays We saw a platform technology that we believed was world leading quite a participative role. It’s not a million miles away from the and had enormous scale opportunities ahead of it because the GPCR coalface. I like to roll my sleeves up and get stuck into building universe is very large. You can measure it. Including the sensory recep- business so it was attractive to me to join the Sosei board. tors, there are over 800. If you take those out it’s nearer 400. And while I was able to bring some of my experiences out of big pharma – GPCRs have been the targets against 40% of industry’s drugs, many GSK for 23 years – and experiences out of biotechnology companies, of those are suboptimal and only a quarter of the GPCRs have been where I worked on the board of several companies. With the acqui- drugged. So there is an enormous scope ahead of us. We can count sition of Heptares I was the designated board member to oversee the targets, and then you have agonist forms, antagonist forms, partial that, as I was with Allergan. The CEO and the board approached me agonist forms. In a practical sense there is almost an unlimited oppor- several months ago to ask if I’d be interested in taking on the CEO tunity. And what Heptares has delivered, from the first wave of assets it role. My answer was that I’d be very interested. I was at that point the has developed over the past 12-14 months, we believe we can repeat CEO of Syngene International Ltd., a contract research company in again and again. India. My contractual obligations to them were to build the company So what attracted us to Heptares fundamentally was the quality and list it in India and I had a contract that expired on March 31, so of the platform – we believe it’s world leading – and the scalability I had an evening off and then on April 1 I was in the COO role for of that platform going forward, which we believe is practically al- Sosei. Because I was a non-exec and because of the nature of being most unlimited. a non-exec of a small company, I hit the ground running. I bring a Since the acquisition Heptares has comprehensively validated the underlying technology platform with a strong series of collaborations degree of continuity and also a new outlook on what we need to do with some of the world’s leading companies in their fields. Immuno- to achieve the vision. oncology with AstraZeneca, migraine with Teva, neurology and Al- Scrip: What prompted the Heptares acquisition? zheimer’s with Allergan, and the discovery collaboration with Pfizer. That gives us enormous confidence going forward. Peter Bains: Sosei’s transformation began about five years ago when the Sosei board established a long term strategic framework. Scrip: So what happens next at Sosei? The aim was to build a leading global biopharmaceutical company Peter Bains: First and foremost our strategy is to look at organic which was anchored in Japan. That meant that we needed to look for growth focusing on Heptares. But that’s multi-layered. We are look- platform opportunities to create the catalyst to achieve the vision. ing to strengthen our technology leadership. A good example of that Sosei was in a very strong position as the glycopyrronium asset that is our participation in the consortium for the cryogenic electron mi- had been licensed to Novartis was making strong progress and head- croscopy. It’s highly complementary to our world leadership in X-ray ing to the market, providing the company with cash flow. We had a driven high resolution crystallography and it’s particularly useful in sense of urgency, but we were able to take our time to go and search complex proteins. for what we wanted to be a catalytic transformational high quality plat- We will look to increase the number of STARs that we develop. form opportunity. From the STARs we get the In the ensuing years we took a few smaller steps with the acquisition crystals, from the crystals we CLICK of a nanotechnology platform and also Jitsubo, which has a peptide get the candidates, and they Read the full interview platform. But unquestionably the acquisition of Heptares has been the then become opportunities at: http://bit.ly/1W8t5IX transformational and catalytic event. for development.

Fanfare For A Biotech Bottom Andy Smith

ne of the most difficult parts of the away from. In addition, since its peak last jobs of investors and analysts is to summer, the biotech sector is only off about Opredict the future. This can prove 30%. Only. tricky so we fall back on our experience by The other supposed attraction for inves- associating what has happened in the past tors new to the sector is the FDA’s more with what is likely to occur in the future. In open-door policy on drug approvals. This taking the temperature prior to the start of has been tempered of late by the atten- this year’s JP Morgan Healthcare conference tion of members of the US senate on drug I did not expect that almost every bearish pricing but the reality of many new drug prediction would come true and the stock approvals is not a blockbuster panacea. price plummets that commenced that Who can forget the commercial disasters week would mark the start of one of the of Omontys (peginesatide) from Affymax worst first-quarters for life science compa- Inc. and Incivek (telaprevir) from Vertex Phar-

nies for many years. Sergii Iaremenko Shutterstock: maceuticals Inc. both of which were with- Now that the first-quarter of 2016 is be- drawn and Afrezza (inhaled human insulin) hind us, attentions turn to the rest of the components in combination therapies and from MannKind Corp., all recently approved year and at the Biotechs and the City event both have a captive partner – Astellas Phar- drugs but none likely to ever recoup their in London last week a former colleague ma Inc. in Medivation’s case – that might not development cost. mentioned her expectations for a further be fleet of foot, or price insensitive enough The chain of events illustrated by Mediva- leg down in stock prices before we reach to secure the acquisition of the full Xtandi tion (but not Affymax, Vertex or MannKind) a bottom. While that weakness may still be rights and royalties. that looks like resulting in a profitable exit the case, I am looking for any sign that the Fortunately for most of the generalist in- is positive clinical trials, FDA approval, bil- sector has reached the nadir and unfortu- vestors who were once attracted to the sec- lion dollar sales and acquisition by a bigger nately, I have not yet seen many. tor for its M&A, but left it without seeing the company. A very different scenario looks One of the supposed attractions of the expected transactions that their ironically more likely to occur at Keryx Biopharmaceu- sector to the generalist investor, and which price-insensitive buying prohibited, one ticals Inc. While Keryx’s announcement of partly catalyzed the seven-year biotech bull swallow does not make a summer. However, positive Phase III results for its lead product market that ended last summer, is the high the sell-side analysts, no doubt touting for Auryxia (ferric citrate) resulted in about a 7% level of merger and acquisition (M&A) trans- the transactional business on behalf of their rise in its share price on the day, it finished actions that punctuates the cycles of the banking colleagues, were quick to point the week about where it had started. Inves- sector. Medivation Inc. had a bad start to last to the companies under their coverage as tors and analysts have increasingly come to week after receiving the ire of six members the next acquisition. In a fit of crying wolf, recognize Auryxia – with sales last quarter of Congress, including a presidential candi- the analysts from Citigroup reeled off eight of less than $6m after enacting an unpalat- date, for the price of its lead oncology drug companies under their coverage (including able 9% price increase – for its lackluster at- Xtandi (enzalutamide). However, Mediva- Medivation) that are likely to be acquired in tributes and a good dose of rationality sup- tion’s stock price finished the week up about the next 12-18 months. This reminds me of a pressed Keryx’s share price. At least there is 10% after reports that it had appointed in- sketch from the BBC Radio series Old Harry’s one rational sign that we are close to a bot- vestment bankers to defend against take- Game where Satan bemoans the human tom in biotech. over interest. The parties that are interested race when asking which species proclaims The Magna Biopharma Income fund in acquiring Medivation must be thanking humans as the most advanced species on holdings include Medivation. the senators for their intervention aimed at Earth? Who says that the companies under depressing Xtandi’s price and which also de- coverage by an analyst will be acquired? The Andy Smith is chief investment officer of Mann pressed Medivation’s share price prior to the analyst covering the companies. Bioinvest. Mann Bioinvest is the investment 20% jump on the M&A reports. The acquisi- If the wilderness years after the 2001 bio- adviser for the Magna BioPharma Income tion of Medivation by a bigger pharmaceu- tech market correction are anything to go fund which has no position in the stocks men- tical or biotechnology partner is eminently by, it took a series of acquisitions of com- tioned, unless stated above. Dr Smith gives an logical and has much in common with the panies whose share prices were half or less investment fund manager’s view on public acquisition of Pharmacyclics Inc. by AbbVie than their peak in a quiet tempo of transac- life science companies. He has been lead fund Inc. last year. Both have growing oral oncol- tions for the generalist investor to become manager for four life science–specific funds, in- ogy products with expanding indications interested in the sector. It is only wishful cluding International Biotechnology Trust and – in Xtandi’s case, into earlier-stage prostate thinking for the sell-side to expect a transac- the AXA Framlington Biotech Fund, and was cancer and possibly a breast cancer sub- tion forte that prompts a quick return to the awarded the Technology Fund Manager of the set – both agents are being investigated as sector that generalists have only just rotated year for 2007.

scripintelligence.com 6 May 2016 | Scrip intelligence | 21 Pipeline Watch

Scrip’s weekly Pipeline Watch tabulates the most recently reported CLICK late-stage clinical trial and regulatory developments from the more Visit scrip intelligence.com than 10,000 drug candidates currently under active research worldwide. for the entire pipeline with added commentary. Late-stage clinical developments for the week 22-28 April 2016

Lead Company Partner Company Drug Indication Market REGULATORY APPROVAL Bevespi Aerosphere (glycopyrro- chronic obstructive pulmonary disease AstraZeneca PLC – US late/formoterol fumarate) (COPD) Servier Taiho Lonsurf (trifluridine/tipiracil) colorectal cancer EU Exelixis Inc Ipsen SA Cabometyx (cabozantinib) advanced renal cell carcinoma US Collegium Pharmaceutical Inc. – Xtampza ER (oxycodone) chronic pain US Descovy (emtricitabine and Gilead Sciences Inc – HIV/AIDS EU tenofovir alafenamide) Aralez Pharmaceuticals Inc. FAES Pharma SA Blexten (bilastine) tablets seasonal allergic rhinitis and urticaria Canada SUPPLEMENTAL REGULATORY APPROVAL Viekira Pak (ombitasvir, Enanta US and AbbVie Inc. paritaprevir, ritonavir tablets; hepatitis C Pharmaceuticals Inc. EU dasabuvir tablets) TachoSil (human thrombin/ Takeda Pharmaceutical Co. – wound healing EU human fibrogen) Swedish Orphan Biovitrum AB – Orfadin (nitisinone) hereditary tyrosinemia type-1 US FAST-TRACK STATUS Advaxis Inc. – ADXS-cHER2 osteosarcoma US Therabron Therapeutics Inc. – CG100 bronchopulmonary dysplasia US AM-Pharma BV – reCAP renal disease US

BREAKTHROUGH THERAPY DESIGNATION TNF receptor associated periodic syndrome, Novartis AG – Ilaris (canakinumab) hyperimmunoglobulin D syndrome and US familial Mediterranean fever Bristol-Myers Squibb & Co. – Opdivo (nivolumab) head-and-neck cancer US

COMPLETE RESPONSE LETTER Otsuka Pharmaceutical Co. Proteus Digital Abilify (aripiprazole) plus ingestible schizophrenia, bipolar I disorder and major US Ltd. Health sensor and wearable patch depressive disorder REGULATORY FILING Johnson & Johnson – Vermox (mebendazole) helminthiasis US Vifor Fresenius Relypsa Inc Veltassa (patiromer) hyperkalemia EU

REGULATORY REVIEW EXTENSION Dynavax Technologies Corp. – Heplisav-B hepatitis B vaccine US

RESPONSE SUBMITTED TO COMPLETE RESPONSE LETTER Opko Health Inc. – Rayaldee (calcifediol) secondary hyperparathyroidism US H Lundbeck A/S – Carnexiv (iv carbamazepine) epilepsy US PRODUCT LAUNCH Newron Denmark, Zambon SpA Xadago (safinamide) Parkinson’s disease Pharmaceuticals Sweden Pfizer Inc. – Quillivant XR(methylphenidate) attention deficit hyperactivity disorder US Wellstat Therapeutics Corp. BTG plc Xuriden (uridine triacetate) hereditary orotic aciduria US Source: Sagient Research’s BioMedTracker

Finnish drug development company, he also held the post of chief commercial Mylan has appointed Kenneth Parks Faron Pharmaceuticals, Ltd. has ap- officer. He has 25 years of industry experi- chief financial officer (CFO). Parks has over pointed Matti Karvonen medical direc- ence, previously serving companies such 30 years of corporate finance experience, tor. Karvonen has a background in clinical as NPS Pharmaceuticals, Inc. and ViroP- having previously served as senior vice neurology, and has previously served at harma, Inc., where he held several senior president and CFO at Wesco International. several international pharma organisations, leadership roles. Prior to this he held various senior roles at including Roche Holdings AG, Novartis AG United Technologies Corporation, most and Biogen. He has also co-founded sev- The genomic medicine company, Med- recently as vice president, finance. eral commercial medical organisations and genics Inc., has appointed Michael has participated in a number of clinical Diem, former head of corporate strategy Abeona Therapeutics Inc. has appoint- programmes, most recently in the pan-Eu- and corporate development at AstraZen- ed Christine Silverstein vice president of ropean launch of a new neurological drug. eca PLC, senior vice president of business investor relations. Silverstein brings over 12 and corporate development. Prior to his years of corporate communications experi- GarmaMabs Pharma has appointed time at AstraZeneca, Diem was head of ence to the role, having previously served Martine J. George an independent board business development at GlaxoSmithKline as director of investor relations at Relmada member. George joins the biotechnology Rare Diseases, having previously acted as Therapeutics and vice president of corpo- company from Pfizer Inc, where she previ- a partner in its corporate venture capital rate development and investor relations at ously served as vice president global medi- firm, SR One Ltd. PlasmaTech BioPharmaceuticals, Inc. cal affairs, oncology. As a board-certified oncologist and gynecologist, she has pre- XBiotech Inc., the global biosciences UK-based biotech company Tiziana Life viously held senior positions at GPC Bio- company specialising in therapeutic anti- Sciences has appointed Dr Robert Evans tech and Johnson & Johnson, and has led bodies, has appointed Scott Whitehurst vice president, clinical sciences. Evans joins the successful launch of drugs in multiple chief financial officer. Whitehurst joins the the business from Glenmark Pharmaceu- oncology indications. business from Amgen, where he held the ticals, where he was previously vice presi- post of vice president of finance, opera- dent, clinical development. Prior to this, he UniQure N.V. has appointed Paul Firuta tions for the past eight years. Prior to this, held a variety of scientific leadership roles at chief commercial officer. Firuta joins the he spent 14 years at Hewlett-Packard Co. Regeneron Pharmaceutical, where he also company, which specialises in human before serving as chief financial officer at worked alongside Tiziana’s current chief op- gene therapy, from BioBlast Pharma, where Novartis Animal Health. erating officer, James Tripp.

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scripintelligence.com 6 May 2016 | Scrip intelligence | 23 Maximize Your Reimbursement Potential

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