Friday Five - The pharma week in review (10 October 2019)

UCB doubles down on rare disease

UCB is to acquire Ra Pharmaceuticals for $2.5 billion. The deal will bring zilucoplan, a once-daily self-administered, subcutaneous peptide inhibitor of complement component 5 (C5) into UCB's pipeline. It is currently being investigated in the late-stage RAISE study for generalised myasthenia gravis, with top-line results expected in early 2021.

With UCB already developing the FcRn-targeting antibody rozanolixizumab for myasthenia gravis, it remains to be seen if the deal meets anti-competitive standards. Pharma deals have been heavily scrutinised in recent months, most notably Roche's proposed acquisition of Spark Therapeutics.

See Monday's FirstWord newsletter for further analysis of this acquisition.

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Euro-pharma steps up its M&A game

The UCB/Ra Pharma deal also highlights another recent trend; the prominent role of European pharma in M&A activity during the second half of 2019.

Last month Lundbeck agreed to acquire Alder Pharmaceuticals for $2 billion and Swedish Orphan Biovitrum (SOBI) said it is to buy Dova Pharmaceuticals in a deal valued at $915 million.

In August Bayer acquired BlueRock Therapeutics.

Global pharma M&A activity has otherwise been relatively quiet during the third quarter, though Gilead Sciences did take a stake in Galapagos as part of a broad licensing agreement, and Vertex acquired Semma Therapeutics for $1 billion to expand its pipeline focus into diabetes.

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ICER ups the ante

In highlighting seven high-profile drugs that it described as having substantial price increases in 2017 and 2018 that were not justified by new clinical evidence, ICER has firmed up its sometime controversial role in the US drug pricing debate.

The drugs in question (the list is here) are notably all nearing the end of their life cycles, suggesting that their respective manufacturers may have been looking to maximise revenues while they can.

Unsurprisingly, ICER has attracted criticism from these same drugmakers. One particular concern being how ICER calculated the net prices for the drugs highlighted. Net prices are typically not readily available in the public domain and PhRMA was keen to highlight that over the same period the net price of numerous drugs evaluated by ICER has declined.

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Beovu approval could put more pressure on Regeneron

In line with expectations, the FDA approved Novartis' Beovu for wet age-related macular degeneration (AMD), maintaining an impressive regulatory hit rate for the Swiss drugmaker this year.

Analysis - ViewPoints: Ophthalmology approval keeps Novartis' R&D output on the up

Launch of Beovu will raise the competitive stakes for Regeneron Pharmaceuticals' Eylea. Shares in the US biotech are already down some 30% since the turn of the year.

Concerns about the company's exposure to Medicare reforms hasn't helped, and in a recent note to investors, Leerink analyst Geoffrey Porges suggested competitors have become better at developing antibody drugs, thus raising the bar for Regeneron. This puts further emphasis on whether the company has enough in its R&D locker to offset future erosion of Eylea sales.

To what extent Eylea revenues decline remains unclear, though Novartis knows the AMD market well (it markets Lucentis in ex-US territories) and Beovu is differentiated versus Eylea by offering at least non-inferior efficacy with less frequent dosing (every three months versus every two months).

Commenting on Novartis' decision to price Beovu comparably to Eylea, analysts at Credit Suisse expect the Swiss company to market and rebate their asset aggressively, noting "Beovu may be the first significant challenger to Eylea's leadership since launch."

See also - KOL Views: How close is the Beovu bogey in Eylea’s rear-view mirror?

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Novo Nordisk plays the long game in haemophilia gene therapy

Novo Nordisk's market share in haemophilia A - where it currently generates over $1 billion each year with its NovoSeven franchise - is under threat.

Roche's Hemlibra represents notable disruptive innovation in this disease area, while BioMarin is poised to file the first haemophilia A gene therapy with regulators by the end of the year.

It is no real surprise then that the Danish company sought a tie-up with bluebird bio this week, designed to accelerate its own gene therapy aspirations.

Novo Nordisk is banking on bluebird's megaTAL gene editing capabilities to help develop a next-generation gene therapy, citing both the specificity of this approach - which could limit off-target effects - and its potential use with both viral and non-viral delivery methods.

With the aim to have a preclinical candidate ready for studies within the next few years, the new partnership will be a long way behind potential front-runners such as BioMarin and Spark Therapeutics. This led analysts to question the commercial opportunity associated with the collaboration, one caveat being that clinical data reported for haemophilia A gene therapies to date indicates there is scope for improvement.

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