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Greetings from JPM Week 2024! We’re coming to you live from San Francisco, where the industry’s biggest annual convocation is about to kick off — this time, without any substantive chatter about relocation to warmer, drier climes. And why would we leave SF? That yellow orb you see in the sky? It’s the sun! Our morning newsletter has switched to an afternoon format so that our team of STAT reporters on the ground — Allison DeAngelis, Damian Garde, Adam Feuerstein, Matthew Herper, Tara Bannow, Mohana Ravindranath, and Angus Chen — can bring you all the news, analysis, and cocktail party gossip. Let’s do this!
Expectations for M&A are sky high
That’s what happens when the last five weeks of 2023 delivered nearly $40 billion worth of biotech takeouts — RayzeBio, Gracell, Karuna Therapeutics, Icosavax, Cerevel Therapeutics and Immunogen. Folks want more!
And so, here we sit on the eve of JPM Week and … crickets? The speculative, water-cooler chatter has Novartis buying Cytokinetics and its blockbuster-in-the-making heart medicine for $15 billion, right? What’s taking so long?
Fear not, if history is your guide, JPM doesn’t typically bring “wow” deals. Does anyone remember last year’s catch? Four modestly sized deals announced on Monday, none very exciting. Then, two months later, Pfizer-Seagen happened. In all, 2023 was the second-best year for biotech M&A on record.
“Whether or not the December activity was a jump-start on what would have typically been announced in January is certainly debatable, but the way the investment banking community… is setting the stage for near term transactions does imply that a frenzy could be in the cards over the near term,” wrote Mizuho biotech strategist Jared Holz in a note to clients, titled (appropriately) “M&A Expectations Sky High.”
Monday’s going to be interesting
If you’re among the minority of people who come to San Francisco for the actual investor conference — or the many more who tune in remotely — tomorrow brings a spate of those rare presentations that might actually make news.
Bristol Myers Squibb, Moderna, Novartis, and Sarepta Therapeutics are each due to take the stage. Each is poised for what could be a transformative year, whether because of impending clinical data, major commercial tests, or elevating pressure to do more deals.
There’s more on those companies and the other key presentations to watch in our JPM preview.
No pain data yet from Vertex
Vertex Pharmaceuticals issued a pipeline and business update today, ahead of a presentation on Monday by CEO Reshma Kewalramani. As expected, the company did not offer readouts from Phase 3 studies of VX-548 in acute pain, although those closely tracked results are coming in “early 2024.” Also coming soon will be readouts from pivotal studies of a triple-drug regimen for cystic fibrosis that is formulated into a single, once-daily pill. Vertex’s current cystic fibrosis treatment is taken twice per day.
Investors are likely to query Vertex about the early commercial launch of Casgevy, its CRISPR-based therapy for sickle cell disease that was approved in early December. In its update today, Vertex said it signed an access agreement with a Blue Cross Blue Shield network that covers 100 million people. Nine sickle cell treatment centers — six in the U.S. and three in Europe — have been activated to date, with a goal of activating about 50 in the U.S. and 25 in Europe.
Vertex also said the FDA has requested additional information about VX-670, an RNA-based medicine for people with myotonic dystrophy Type 1, resulting in a clinical hold that will delay the start of a first clinical trial.
AI? Say hi!
It’s not a shock, with the furor over artificial intelligence and machine learning in the larger culture, that AI looks set to have a moment here in the alternate dimension that is JPM, too.
Insitro, which as of 2021 had raised $643 million at a $2.5 billion valuation, according to Pitchbook, unveiled research that could lead to drugs in ALS, the liver disease MASH, and cancer in a STAT exclusive. The company also revealed it had hired a chief medical officer from Pfizer. Alphabet’s Isomorphic Labs announced deals with Lilly and Novartis. Nvidia, the AI chipmaker whose valuation has ballooned to $1.2 trillion because of excitement over AI, is due to present at JPM on Monday.
But as STAT’s Matthew Herper writes in the Insitro story, there is every reason to remember that drug development could be almost as hard for computers as it is for people. Most early stage projects fail, and doing cool stuff doesn’t mean there isn’t a very long way to go.
Is JPM good for the XBI?
One way to look at this conference is that a bunch of people from all around the world gather in one place in an attempt to collectively will biotech stocks to go up. Does it work?
Looking at data from the last decade of JPM weeks, the answer is: kinda. The XBI, a closely tracked index of biotech companies, has risen by just .76% on average during the conference. There are a few outliers. In 2016, a flashpoint for the industry’s drug pricing panic, the XBI fell 7% during JPM week. In 2019, the year Bristol Myers Squibb bought Celgene, it rose 7%. The median works out to a respectable 2.25%.
What that portends for JPM 2024 is anyone’s guess. Like 2016, it’s a presidential election year, which has historically meant volatility for biotech. But like 2019, there are quite a few cash-rich pharma companies in need of new products to maintain their balance sheets. Also Jim Cramer is here, if that kind of thing affects your calculus.
Pivoting JPM to video
This year, STAT’s coverage of JPM will come at 30 frames per second. We’ll be filming short interviews and commentaries from the streets, hallways, and stages of the conference. Keep tabs on our channels — TikTok, Instagram, YouTube, and the website formerly known as Twitter — all week if you want to catch them. We’ve already posted a pair of service-y JPM previews, if you’re in search of last-minute tips.
More reads
- As annual bash starts in San Francisco, biotech executives see hopeful signs in struggling sector, Boston Globe
- Ozempic challengers, immunology firms line up for rebound in M&A, Bloomberg
- Alphabet’s Isomorphic inks first pharma deals with Eli Lilly and Novartis, Endpoints