When is a Wall Street disappointment ‘good enough’ for the FDA?

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Good morning, everyone. Damian here. Yesterday’s Nobel wins for Katalin Karikó and Drew Weissman called to mind the humble beginnings of mRNA research — and the fact that Karikó’s scientific career nearly ended before their key discovery, as she explained back in 2020.

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The need-to-know this morning
• Eli Lilly said it would acquire Point Biopharma in an all-cash deal valued at $1.4 billion.
• Sanofi is paying $175 million to license Johnson & Johnson’s late-stage vaccine for E. coli.
• Regeneron Pharmaceuticals expanded its partnership with Intellia Therapeutics to develop two more CRISPR-based medicines.
• ALX Oncology said its experimental immunotherapy improved the number of tumors that responded, or shrank, when added to other cancer medicines in gastric cancer. The drug targets CD47, an immune checkpoint. Shares of the company rose 105% in premarket trading.

Look on the bright side of biotech’s slump
Biotech’s protracted decline hit a fresh nadir yesterday, with the closely watched XBI biotech index falling to its lowest point since mid-2022. The XBI is now down more than 13% in 2023 after falling 30% the year before.

The upside, if one exists, is that biotech has firmly slipped into what people on financial television call a stock-picker’s market, meaning the disparity between the broader index and its individual success stories has rarely been wider.

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When the XBI was soaring in 2021, generating a return was virtually a matter of throwing darts at a list of biotech companies, making it difficult for any one fund to outperform the market. Now that the index pretty much declines week after week, a wise bet on one of the sector’s few upwardly mobile companies will look that much better in context.

Lilly’s grand ambitions keep hitting snags
Eli Lilly has become the world’s most valuable drugmaker thanks to the promise of some potentially practice-changing medicines. But the company can’t sell its products if it can’t properly manufacture them, a problem that has now delayed two high-profile drug launches.

Yesterday, the FDA rejected lebrikizumab, an autoimmune treatment with blockbuster potential, citing issues from an inspection of Lilly’s third-party manufacturer. In April, the agency rejected another prized new medicine, the ulcerative colitis treatment mirikizumab, because of issues with Lilly’s in-house manufacturing.

Neither rejection was related to clinical data or product safety, according to Lilly, which means each will only push the company’s timelines rather than derail them. But Lilly’s roughly $500 billion valuation is based on the company’s ability to swiftly launch a spate of new medicines, including high-profile treatments for Alzheimer’s disease and obesity, and living up to those expectations will require getting its manufacturing in order.

When is a Wall Street disappointment ‘good enough’ for the FDA?
Syndax Pharmaceuticals’ treatment for a genetically defined form of leukemia met its primary goal in a clinical trial, the company said yesterday, but the drug’s ultimate benefits came in below investors’ expectations, and it’s unclear whether they’ll satisfy the FDA.

The news is that Syndax’s drug, revumenib, led to complete remission for 23% of patients with treatment-resistant forms of acute myeloid leukemia or acute lymphoid leukemia. That met the trial’s primary goal and led the study’s independent data monitors to recommend stopping it early, but it’s lower than 33% remission rate seen in earlier trials and the roughly 30% rate Wall Street was looking for.

The company’s shares fell about 7% on the news, reflecting investors’ uncertainty about the future of revumenib. “Despite today’s primary endpoint missing investor expectations, we still believe the data is good enough to support approval,” Baird analyst Joel Beatty wrote in a note to clients, citing prior FDA decisions for dire cancer diagnoses and revumenib’s relatively clean safety profile.

Read more.

Mirum’s $445 million bet pays off
Mirum Pharmaceuticals said yesterday that Chenodal, a medicine it recently acquired in a $445 million deal, met its goals in a late-stage trial enrolling patients with a rare metabolic disorder.

As STAT’s Jonathan Wosen reports, the drug successfully treated cerebrotendinous xanthomatosis, or CTX, a rare and serious disease in which the body doesn’t metabolize cholesterol properly. Mirum plans to file its medicine for FDA approval in the first half of next year.

Mirum bought Chenodal from Travere Therapeutics in July, paying $210 million up front before knowing the results of the latest study. The drug is already used off-label for CTX, but winning FDA approval would allow Mirum to actually market it, which is expected to meaningfully improve sales.

Read more.

More reads
• Congress extends some pandemic preparedness programs, but not all, STAT
• Drugmakers sign on to negotiate Medicare prices under protest, Reuters
• Verily lands $38 million deal with CDC for wastewater surveillance, STAT