Top of the morning to you. I’m filling in for Ed Silverman this morning, which means you’re getting Brooklyn instead of the Pharmalot compound, Barry’s tea instead of flavored coffee, and most shockingly, adorable cats. I know. But I can still line up some listening material for the morning news. I know, we are all eagerly awaiting the return of our beloved Pharmalot, but let’s get to it.
Cytokinetics did a deal with Royalty Pharma, the biotech firm that has become a huge success by buying up small shares of other companies’ drugs, to secure up to $575 million in funding, STAT reports. Investors hate it, and the stock is off 14% in early morning trading. One reason is that stockholders were hoping a larger company would buy out Cytokinetics for its nearly approved heart drug, aficamten. This makes that less likely.
But as my colleague Adam Feuerstein points out in his STAT column this morning, it’s also that Cytokinetics is planning another trial of a heart failure drug, omecamtiv mecarbil, that has failed. And the terms there are great – if you’re Royalty Pharma. If the drug works, Royalty gets $100 million and a 2% royalty. If it fails, Royalty gets $275 million straight out of Cytokinetics’ pocket. Adam says this puts Cytokinetics CEO Robert Blum, whom he interviewed on stage last week, back on his list of potential worst CEOs for the year.
