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Good morning, everyone. Damian here with an in-depth preview of a certain annual biotech conference, a look at the cutting edge of obesity drug development, and year’s first IPO filing.
The need-to-know this morning
- Eli Lilly issued an “open letter” warning against the use of its GLP-1 drugs Mounjaro and Zepbound for “cosmetic weight loss.”
- A judge recommended the dismissal of a defamation lawsuit filed by Cassava Sciences against two neuroscientists, Geoffrey Pitt and David Bredt, who had petitioned the FDA to halt the development of the company’s experimental Alzheimer’s drug.
- It’s a big morning for “2024 corporate update” press releases from biotech companies — too many to list here.
Your guide to #JPM24
Will there be deals? Why is Nvidia here? And can biotech’s good vibes survive?
We rounded up all the burning questions heading into the 2024 iteration of the J.P. Morgan Healthcare Conference, which begins Monday in San Francisco. That includes a list of the corporate presentations that might actually be interesting, a look at how venture capitalists are feeling about the new year, and how the specter of a pugilistic FTC might cast a shadow over the whole affair.
And speaking of JPM, starting Sunday, this newsletter will become your one-stop source for all of STAT’s reporting from the conference, delivered to your inbox each afternoon.
A gentler approach to genome editing
CRISPR genome editing, for all its utility, relies on cutting into strands of DNA, a prospect that can limit its benefits for certain diseases and lead to problematic off-target edits. Feng Zhang, the Broad Institute’s resident CRISPR pioneer, co-founded a company to push forward a less violent approach to tinkering with the genome.
As STAT’s Allison DeAngelis reports, the company is called Moonwalk Therapeutics, and the idea is epigenetic editing. Where most genome editing technologies are aimed at DNA itself, Moonwalk is targeting the surrounding chemical compounds that impact gene expression, crafting medicines that might switch genes on and off without making permanent changes to DNA.
Among Zhang’s co-founders is Alex Aravanis, who helped start the blood testing firm Grail and will serve as CEO. The company’s funding syndicate includes Alpha Wave Ventures, Arch Venture Partners, and Khosla Ventures.
Novo is looking for weight-loss drugs on the cutting edge
Novo Nordisk, maker of the blockbuster obesity treatment Wegovy, has a long-term vision of revolutionizing the treatment of metabolic disease. Getting there is going to require turning some speculative science into effective medicines.
In obesity, that means turning to genome editing. Novo said today that it has partnered with Omega Therapeutics, a Flagship Pioneering company, to develop a novel therapy that would manipulate a person’s DNA to effectively turn up the heat and burn energy, thereby leading to weight loss. In MASH, the prevalent, obesity-related liver disease, Novo is working with another Flagship startup called Cellarity in search of a small-molecule drug.
Each deal is relatively small, adding up to a potential $1 billion if both companies hit certain milestones. But each adds to Novo’s growing mosaic of potential medicines that might succeed Wegovy and Ozempic, including RNA-based treatments, cannabinoid-targeting therapies, and drugs designed to preserve muscle mass during weight loss.
The first test of 2024’s IPO waters
Last year’s biotech rebound brought a boost in dealmaking, gains for biotech stocks, and a few massive venture capital rounds for newfangled startups. But IPOs, an integral part of the industry’s financial ecosystem, got left behind in 2023, which saw the fewest biotech companies go public in a decade.
We’ll soon find out whether 2024 will be different. First up is CG Oncology, which filed its IPO paperwork with the SEC yesterday. The company, headquartered in Irvine, Calif., is in Phase 3 with a treatment for bladder cancer, enrolling patients who have already tried the standard of care. The drug, called cretostimogene, is CG’s only pipeline asset.
CG doesn’t exactly have the markings of a bellwether biotech IPO. The company’s list of investors doesn’t include any of the industry’s name-brand VCs, and it had just $10 million in cash as of Sept. 30. But its success or failure going public will provide a potentially instructive datapoint in a year that is likely to see many more startups attempting IPOs.