< PreviousM&A ROUND-UP 10 Pharma Business International www.pbiforum.net development candidate TAK-186 (MVC- 101). The candidate is currently in a Phase 1/2 study for the treatment of EGFR-expressing solid tumours, and TAK-280 (MVC-280). It is anticipated to enter the clinic in the second half of Takeda’s fiscal year 2021 for the treatment of patients with B7H3- expressing solid tumours. After closing of the transaction – expected to be finalised in Q1 of Takeda’s fiscal year 2021 – Maverick employees will join Takeda’s Research & Development organisation. Next up, Sandoz, a Switzerland-based division of big ten pharmaceutical firm Novartis, announced in February that it was acquiring GlaxoSmithKline’s (GSK) cephalosporin antibiotics business. The agreement, which sees Sandoz reinforce its global position in antibiotics, includes the global rights to three established brands (Zinnat, Zinacef and Fortum) in more than one hundred markets. In 2020, the three brands had combined sales of approximately $140 million in the relevant markets. However, the deal excludes the rights in the US, Australia and Germany to certain of those brands – which were previously divested by GSK – and in India, Pakistan, Egypt, Japan (to certain of the brands) and China, which will be retained by GSK. Sandoz will pay GSK $350 million at closing, plus additional milestone payments of up to $150 million, subject to the terms of the transaction. Closing of the transaction is expected in the second half of 2021, subject to customary closing conditions including regulatory approvals. Sandoz intends in the longer term to manufacture Zinnat at sites in its own network, which has global antibiotics production centered on its lead production site in Kundl, Austria. Once the transaction is completed, GSK will supply Zinnat to Sandoz under a manufacturing and supply agreement, while supporting a transfer of the related manufacturing operations to Sandoz. In the first billion-dollar-plus deal of this issue, Merck is adding a robust autoimmune disease pipeline to its portfolio with the $1.85 billion acquisition of Watertown, Massachusetts-based Pandion Therapeutics. Pandion is advancing a pipeline of precision immune modulators targeting critical immune control nodes. The company’s lead candidate – PT101 – is an engineered IL-2 mutein fused to a protein backbone designed to selectively activate and expand regulatory T cells (Tregs) for the potential treatment of ulcerative colitis and other autoimmune diseases. Earlier this year, Pandion announced that PT101 had completed a Phase 1a clinical trial, which achieved its primary objective of safety and tolerability. The company’s pipeline also includes PD-1 agonists in development for numerous autoimmune diseases. Merck, through a subsidiary, will initiate a tender offer to acquire all outstanding shares of Pandion. The closing of the © Shutterstock /Michael V i 08-11.qxp_Layout 1 08/04/2021 12:14 Page 3Pharma Business International 11 www.pbiforum.net M&A ROUND-UP tender offer, including the tender of shares representing at least a majority of the total number of Pandion’s shares of fully-diluted common stock, the expiration of the waiting period under the Hart- Scott-Rodino Antitrust Improvements Act and other customary conditions. Upon the successful completion of the tender offer, Merck’s acquisition subsidiary will be merged into Pandion, and any remaining shares of common stock of Pandion will be cancelled and converted into the right to receive the same $60 per share price payable in the tender offer. The transaction, which will be subject to certain conditions, is expected to close in the first half of 2021. It’s been a busy few months for Amgen, the multinational biopharmaceutical company. Firstly, the company has bolstered its oncology pipeline with the $1.9 billion acquisition of Californian biotech, Five Prime Therapeutics. Five Prime’s lead asset, bemarituzumab, is a first-in-class, Phase 3 ready anti-FGFR2b antibody with positive data from a randomized, placebo-controlled Phase 2 study in frontline advanced gastric or gastroesophageal junction (GEJ) cancer. Bemarituzumab targets FGFR2b, which has been found to be overexpressed in approximately thirty per cent of patients with non-HER2 positive gastric cancer, as well as other solid tumours. The trial demonstrated clinically meaningful improvements in progression-free survival, overall survival and overall response rate in the frontline treatment of patients with advanced gastric or GEJ cancer. The acquisition also supports Amgen’s international expansion strategy. Amgen plans to leverage its presence in Japan and other Asia-Pacific markets to maximise bemarituzumab’s potential. Then, a few weeks later, the company announced its $721 million acquisition of Rodeo Therapeutics Corporation, a privately held biopharmaceutical company based in Seattle that develops small-molecule therapies designed to promote regeneration and repair of multiple tissues. Rodeo’s 15-PGDH program is a strong strategic fit with Amgen’s inflammation portfolio and efforts to develop first-in- class therapeutics for patients. Amgen will therefore acquire all outstanding shares of Rodeo in exchange for a $55 million upfront payment as well as future contingent milestone payments potentially worth up to an additional $666 million in cash. In total, the deal is worth up to $721 million. The transaction has been approved by the shareholders and the Board of Directors of Rodeo. As stability returns to the global economy following the worst of the COVID-19 pandemic, and companies look to sure up and reinforce their pipelines, no doubt we’ll see a rise in M&A activity in the coming quarter. Rest assured, we will cover all of the major deals in our next issue. © Shutterstock /Ralf Liebhold 08-11.qxp_Layout 1 08/04/2021 12:14 Page 4BLOOD DISEASE EXPOSÉ 12 Pharma Business International www.pbiforum.net Research continues apace to develop new treatments for the many different blood disorders, from anaemia and haemophilia to blood cancers like leukaemia. Gene editing, particularly using CRISPR-Cas9 technology, has most recently held the spotlight for non- malignant blood disorders, becoming exemplary for illustrating the curative potential of genetic therapies. A study in the New England Journal of Medicine, from Vertex Pharmaceuticals and CRISPR Therapeutics, found CRISPR- Cas9 could offer new treatments for curing blood disorders including sickle cell disease and beta-thalassemia. With the technology, researchers were able to target a genetic switch that turns off production for a foetal form of haemoglobin. Following one patient with sickle cell disease and another with beta- thalassemia requiring blood stem cells, the researchers deleted the gene BCL11A, to turn on foetal haemoglobin production to replace missing or defective haemoglobin in the patients’ red blood cells. The nineteen-year-old female with beta-thalassemia saw her haemoglobin levels stabilise four months after her last bone marrow transplant with the gene-edited stem cells (removed from the marrow, modified, and reinfused after drug treatment to remove remaining blood stem cells), and remain stable at her last follow-up. In addition she hadn’t needed blood transfusions usually required to manage the disease. The patient did experience initial serious side effects of pneumonia and liver disease which resolved. The patient with sickle cell disease, a thirty-three-year-old female, saw foetal haemoglobin levels rise from 9.1 per cent to 43.2 per cent fifteen months after the procedure. The patient’s mutated haemoglobin levels from sickle cell disease declined to 52.3 per cent from 74.1 per cent. The Gene editing gathers pace The buzz in treating blood disorders is firmly focused on genetic treatments, with a plethora of studies showing promising results. 14 Á 12-15.qxp_Layout 1 08/04/2021 12:15 Page 1Pharma Business International 13 www.pbiforum.net BLOOD DISEASE EXPOSÉ © Shutterstock /Ezume Images 12-15.qxp_Layout 1 08/04/2021 12:15 Page 2BLOOD DISEASE EXPOSÉ 14 Pharma Business International www.pbiforum.net participant hadn’t experienced pain crises following treatment and serious side effects witnessed - sepsis, cholelithiasis, and abdominal pain - were resolved with treatment. A key advantage of the approach against traditional treatment methods for these blood disorders is the fact that it does not require a donor, instead using the patient’s cells, cutting risk of rejection and immune reactions, and potentially making treatments more widely accessible. Following the publication of this study, the researchers have treated 19 patients total. The need for new treatments for conditions like sickle cell disease is clear with, for example, only one Food and Drug administration (FDA) approved treatment - a bone marrow transplant. Another similar study also recently saw promising results from gene therapy to target sickle cell anaemia through promoting production of foetal haemoglobin, but with the code for an RNA which alters expression of the gene. It also relieved patients of episodes of pain crises that are associated with sickle cell disease. As with gene editing strong doses of chemotherapy or radiation are usually required to allow engineered cells to engraft and can cause severe toxicities, with their nonspecific nature harming healthy organs and tissues, researchers are looking to minimise this. Fred Hutchinson Cancer Research Centre, with a four-year $3.5 million grant from the National Institutes of Health, is exploring ways to precisely deliver © Shutterstock /vchal 12-15.qxp_Layout 1 08/04/2021 12:15 Page 3Pharma Business International 15 www.pbiforum.net BLOOD DISEASE EXPOSÉ powerful radioactive particles to blood and marrow cells while sparing other nonblood cells and tissues. The research will involve a radioactive particle called astatine-211, which is known as an “alpha emitter” because of the type of radiation it produces and is ideal for the precise delivery of potent amounts of radiation as it is able to deliver a high dose of energy over a short distance. A delivery vehicle for astatine-211 fashioned out of antibodies is planned. Strides are being made with other non-malignant blood disorders too, such as haemophilia B - a less common form of the already rare disorder which impacts how proteins needed to clot blood are made. Those with the B form of haemophilia lack the clotting protein Factor IX and require preventative drugs to protect against uncontrolled bleeding. uniQure’s late-stage gene therapy study for the disorder, featuring fifty-four participants and delivering a functional Factor IX gene into cells via a virus, indicates that its treatment (AMT-061) can replace the blood-clotting protein missing in those with haemophilia B. For the majority of patients the treatment was able to eliminate bleeding events during the six months after infusion with the gene therapy, with the number of bleeds reported by patients falling eighty-three per cent, and those needing treatment decreasing by ninety-one per cent. Most participants (bar two) discontinued their routine preventative treatment required for severe haemophilia several times a week. However, fifteen patients did still experience bleeds including spontaneous bleeds, those related to injury and surgical procedures. Six months after treatment average Factor IX activity increased from under two per cent at baseline to thirty-seven per cent. In December, though, uniQure’s haemophilia B gene therapy programme hit a roadblock when it was placed on clinical hold by the FDA following a case of liver cancer in one patient that was treated with AMT-061 in October 2019, impacting the gene therapy space and refuelling previous concerns. The company suggested that the patient had multiple risk factors associated with hepatocellular carcinoma - a twenty-five- year history of hepatitis C, hepatitis B virus, evidence of non-alcoholic fatty liver disease and advanced age. In March 2021 uniQure said its therapy was “highly unlikely” to have caused the liver cancer following a month-long investigation. uniQure’s gene therapy is not the only treatment of this type that has recently been linked to cancer, with Bluebird bio reporting two cancer cases in a study of its sickle cell disease therapy. Following an investigation, Bluebird bio also found its gene therapy “very unlikely” to be the cause. Progress meanwhile has been made for a further group of rare blood disorders for which the FDA last year approved the first drug treatment in almost fourteen years. GlaxoSmithKline’s Nucala (mepolizumab) has been approved for adults and children aged twelve years and older with hypereosinophilic syndrome (HES) - which occurs when there is a high number of a type of white blood cells - for six months or longer without another identifiable non-blood related cause of the disease. Symptoms of HES include skin rashes, itching, asthma, difficulty breathing, abdominal pain, vomiting, diarrhoea, arthritis, muscle inflammation, congestive heart failure, deep venous thrombosis, and anaemia. In a randomized, double-blind, multicentre, placebo-controlled trial of 108 patients with HES, patients were randomly assigned to receive Nucala or placebo by injection every four weeks. The trial compared the proportion of subjects who experienced a HES flare during the thirty-two-week treatment period. Fewer patients in the Nucala treatment group (twenty-eight per cent) had HES flares compared to patients in the placebo group (fifty-six per cent). Nucala is also FDA-approved for patients aged 6 years and older with severe asthma with an eosinophilic phenotype and for adult patients with eosinophilic granulomatosis with polyangiitis, a rare autoimmune condition that causes blood vessel inflammation. These are just a few of the exciting steps that have been made recently for the treatment of blood disorders. With gene editing a frontrunner in the space, progress is also being made with safer and more effective gene therapy vectors, while symptom-treating drugs continue to be developed as genetic treatments try to prove themselves. 12-15.qxp_Layout 1 08/04/2021 12:15 Page 4FINANCE 16 Pharma Business International www.pbiforum.net Funding innovation We explore the various ways in which drug discovery and development can be funded. 16-19.qxp_Layout 1 08/04/2021 12:16 Page 1Pharma Business International 17 www.pbiforum.net FINANCE © Shutterstock /T ANY ARICO Some might say that near half of all inventions were serendipitous, happy accidents that contribute to our collective comfort and understanding. While that may in some ways be applicable to the pharmaceutical and life sciences industries, innovations here are typically much more complex and protracted affairs. Setting aside regulatory and ethical challenges, there remains the issue of funding – specifically who’s paying for research, materials, staff, clinical trials and so on. Even the biggest pharmaceutical players are required to secure funding to bankroll drug development or moving a novel new substance into clinical trial. But for research firms and small-scale developers, funding is the very lifeblood of their research and development programmes. Fortunately, there’s a number of different avenues open to companies, researchers and other organisations, whether they get the required amount from one source or from a combination. Although the European Medicines Agency (EMA), the European Union agency for the evaluation and supervision of medicinal products, doesn’t fund research or drug development directly, it can and does provide support to medicine developers. An organisation that does provide direct funding is Innovate UK, a public body driving science and technology innovations to grow the economy. Since 2007, the organisation, billed as the UK’s innovation agency, has invested more than £1.5 billion in innovation, a figure that has been matched in partner and business funding. During this period, it has helped more than 5,000 companies across the industrial spectrum, medical, pharmaceutical and life science companies among them. It does this through direct investment in organisations but also through innovation competitions. 18 Á 16-19.qxp_Layout 1 08/04/2021 12:16 Page 2FINANCE 18 Pharma Business International www.pbiforum.net Yet it’s not only companies Innovate UK provides funding for, but other innovation orientated organisations – including Medicines Discovery Catapult. This independent not-for-profit organisation is a national facility connecting the UK community to accelerate innovative drug discovery. It provides scientific capabilities and acts as a gateway to specialist facilities, technology and expertise, supporting SMEs to dive development and the widespread use of new approaches for the discovery and early development of new medicines. Part of the organisation’s literature is that traditional models of development medicines is “no longer fit for purpose”. It’s currently estimated that it takes an average of 13.5 years to take a new drug to a patient at a typical cost of over £1.2 billion. The challenge, the Medicines Discovery Catapult says, is to do this faster and cheaper without compromising patient safety, a mission it endeavours to © Shutterstock /rban_Reporter 16-19.qxp_Layout 1 08/04/2021 12:16 Page 3FINANCE Pharma Business International 19 www.pbiforum.net accomplish by providing and applying new scientific systems, uses of data and methods of working. Charity organisations, such as the British Heart Foundation and Cancer Research UK, exist to raise money to fund research and medical breakthroughs. The latter, which is the largest independent funder of cancer research in Europe, allows organisations to apply for grants as well as enabling researchers to involve patients in their studies. It funds a broad portfolio of investigator-led research – from individual projects and fellowships, to large-scale team science programmes, multidisciplinary collaborations and international consortia. While there’s grant funding, the charity also makes long-term investments in state-of-the-art facilities and resources. Of course, much of the funding that charity organisations can provide to industry, academia and other organisations comes from the public. Direct donations – whether online or in collections in stores or on the streets – are part of this, but so is campaigns such as coffee mornings, sponsored walks or runs and a myriad of other approaches. When fundraising campaigns capture the public interest and go viral online, they really do have the power to bankroll important research and help change lives. Readers will no doubt recall the now infamous ‘Ice Bucket Challenge’ from the summer of 2014. In short, participants would tip a bucket of cold water over themselves to mimic the sensation of motor neurone disease and nominate others to follow. The campaign eventually raised $115 million which was used to fund several important research products. But public funding isn’t immune to the pricing and funding issues the plague the wider pharmaceutical industry. © Shutterstock /motorolka 16-19.qxp_Layout 1 08/04/2021 12:16 Page 4Next >