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We have made it! This is Elaine Chen, Angus Chen, and Jason Mast and this is the last edition of our special newsletter, The Readout @ JPM. Before you sneak off, there’s a surprising amount to catch up on as things wind down. Let’s get straight to it.
Beneath the deal-making, debate and sympathy over Americans’ anger over health care
For the most part, JPM this year played out as it usually does — presentations, deal-making, cocktail parties. But, unlike in the past, reminders of the murder of UnitedHealth CEO Brian Thompson were everywhere this time. A small crowd of demonstrators gathered outside the Westin on Monday, protesting what they saw as a broken U.S. health care system. Meanwhile, security details trailed executives at every step.
And, according to a source familiar with JPM’s new security protocols, the San Francisco Police Department assigned a dedicated police detail to the conference areas; JPM also increased private security personnel on site this year.
Attendees said all the additional security around the conference sparked discussions about inequity, access, and cost in the health care system and the frustration of the American public over health care. Many said that they were sympathetic to the messages that the demonstrators outside the Westin hoped to send.
Read more on the JPM mood.
Jiangsu Hengrui, a preferred China partner for U.S. biotech, hints at more deals
As we wrote the other day, another hot topic at the conference: Chinese drugmakers, which have the attention of the U.S. biopharma industry like never before. Among the companies of note has been Jiangsu Hengrui Pharmaceuticals, which took the stage earlier today at the conference and emphasized its global ambitions.
“In the last two decades, [Hengrui] has grown from a China-focused generics company to one of the largest innovative medicine companies in the world,” the company’s chief strategy officer, Frank Jiang, said. “Our vision is to be a global biopharma leader.”
The company has been in operation since the 1970s, but has grown in international prominence in recent years. It has reached a dozen licensing agreements since 2018, but the deal-making has really accelerated over the last two years, Jiang said.
How to direct Medicare, from one leader to the next
Meena Seshamani, the director of Center for Medicare and deputy administrator, has one piece of advice for how to lead the country’s largest health insurer: “engage everyone.” Speaking at STAT’s event earlier this week, Seshamani talked about how she and her team were able to see sweeping changes through Medicare over the last three years.
“I think what we have done has very much been engaging everyone in the ecosystem. Utilizing data, getting comments from people — one of the favorite parts of my job was traveling the country and talking to people who rely on Medicare,” Seshamani said. “I think that is the foundation of not only good policymaking, but also good operations.”
Specifically, Seshamani said she saw understanding and learning what unmet needs were among Medicare beneficiaries and other stakeholders as a key part of her role. Some of the things she credited to this approach included creating Medicare payments for community health services, care navigation, and caps on certain out-of-pocket costs.
‘JPM Week’ rewind
From STAT’s Adam Feuerstein: I will remember this week for gorgeous weather, bomb-sniffing dogs, 17-hour workdays, and at least one large M&A deal. Also, Elaine Chen’s banana bread.
I will not miss being asked, “How’s your JPM going?”
In this week’s Biotech Scorecard newsletter, I mused about investor sentiment, pre- and post-conference. I talked to Gilead Sciences’ management team about M&A and hunting for drugs in China (the latter, a VERY hot topic this week).
Ultragenyx CEO Emil Kakkis shared an idea about how the FDA can rebuild trust in vaccines, and he assured me that Peter Marks is staying put. And Daiichi Sankyo has a very busy year ahead with its antibody-drug conjugates, including the mega-blockbuster Enhertu.
If you’re not receiving my weekly Biotech Scorecard newsletter, then, please, improve your life by signing up here. (You have to be a STAT subscriber. And if you’re not, you can rectify that, too.)
CAR-T, osteoporosis, and neuroscience — oh my!
From STAT’s Allison DeAngelis: Coming out of JPM last year, I was struck by how many investors were talking about “I&I” — immune and inflammatory conditions. That turned out to be a sign of things to come, as hundreds of millions of dollars flowed to various companies.
This year, I&I continued to pepper my conversations with venture capitalists at the conference. In particular, there’s an interest in in vivo CAR-T, both for solid tumors and autoimmune conditions. But there’s also been a couple of other interesting areas of confluence: Investors are once again excited about neuroscience.
“Our understanding of basic disease mechanisms has grown considerably, even in the last few years, principally through the use of very large cohort studies,” said Vik Bajaj, who leads Foresite Capital’s company incubation arm, Foresite Labs. “And you will see in the next few years that some studies that otherwise were so large that only the large pharma companies would undertake them, that it’s now going to become within the province of a well funded biotech to actually run those studies, and that is going to cause more interest in a broader target space, in general.”
The other repetitive topic that struck me this year? Osteoporosis. Multiple VCs brought up the bone density condition in conversation this year. Nina Kjellson, general partner at Canaan, attributed it to a regulatory openness towards using biomarkers from the urine or bone densitometry — a test that measures bone mineral content and density — in lieu of following trial participants and seeing how many ended up with bone fractures. Those types of endpoints make conditions like osteoporosis a lot more feasible for investment.
Tune in tomorrow for my full breakdown of what VCs were talking about this year at JPM.
A former NIH director at JPM
It’s been almost a decade since Elias Zerhouni, the former National Institutes of Health director, has been in the biopharma news. But he was still here at JPM, seven years after he “retired” as R&D chief of Sanofi, now making the rounds on a small, little-known company called ModeX Therapeutics.
STAT caught up with him, along with his co-founder Gaby Nabel, a former colleague at both the top ranks of the NIH and Sanofi. Zerhouni was still eager to talk, unprompted, about mistakes he felt Sanofi made: for example, abandoning obesity molecules, similar to tirzepatide and the newer “triple-G” now expected to be a mega-blockbuster for Eli Lilly. Or breaking off a pact he helped broker with heart disease startup Myokardia, four years before Bristol Myers Squibb purchased it for $13 billion. Or ignoring his pleas to create a vaccine against Epstein Barr-Virus, now implicated as a driver of multiple sclerosis.
“I tried to convince Sanofi to develop it three times, and three times they said no,” Zerhouni said.
(In a statement, Sanofi said that “while we will not comment on the specifics of Dr. Zerhouni’s comments, we appreciate his tenure with the company and hope his work continues to bring benefit to patients.)
Zerhouni and Nabel’s focus, though, is on pitching ModeX. The company is built around technology for creating multi-specific drug molecules the pair had worked on at Sanofi, with eyes towards infectious disease, cancer, and inflammatory diseases. A low-profile biotech relatively free of commercial or corporate machinations, they say, suits them.
“When you’re in big pharma, what you’ve come to realize is that you have the reach, but it becomes a big beast, right?” Zerhouni said. “Because you’ve got to always be generating the product to bring in the revenues, and then early research suffers.”
They’ve already lured one major backer in Phil Frost, the octogenarian billionaire who served as vice chairman of Teva Pharmaceuticals and settled in 2019 to pay a fine for an alleged pump-and-dump team. Frost’s company Opko Health bought ModeX in 2022 for $300 million in stock and provided ModeX steady funding, while Zerhouni became president of the larger group.
Zerhouni and Nabel have attracted partnerships from BARDA and Merck for vaccines. The goal, when both are at an age at which many executives might slide into semi-retirement, advising companies and sitting on boards, is to slowly build the next Regeneron.
“Boards?” said Zerhouni. “God, give me a break, what do I need to do boards for?”
More reads
- UnitedHealth mounts full defense of its business in wake of Thompson’s killing, STAT
- Roche’s cardiometabolic chief warns against weight loss ‘obsession’ with GLP-1s, Endpoints
The story has been updated with comment from Sanofi