Pfizer, Starboard, GSK and Medicare News

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Good morning, this week is a busy earnings week. Let's get straight to the reports from Pfizer and Novartis this morning.

This is what you need to know this morning

• Crescent Biopharma made its stock market debut through a reverse merger with the defunct company GlycoMimetics. Backed by $200 million in new funding from a long list of prominent biotech hedge funds, Crescent is developing an anti-cancer antibody that targets PD-1 and VEGF, similar to the drug from Summit Therapeutics and Akeso.
• Biogenic named Daniel Quirk as its new chief medical officer, reporting to Priya Singhal, current head of drug development. Quirk joins Biogen from Bristol Myers Squibb. On Monday, Biogen announced that Chief Financial Officer Michael McDonnell will retire in February 2025. He will be replaced by current CFO Robin Kramer.

Pfizer's profits rose despite criticism from Starboard

Pfizer reported earnings this morning that significantly beat analysts' expectations. Adjusted earnings per share for the third quarter were $1.06 per share, compared to analyst expectations of $0.60 per share. The company's shares rose in premarket trading.

This is the company's first earnings report since activist investor Starboard took a $1 billion stake in the pharmaceutical giant and began putting pressure on its board and CEO.

In a note yesterday, Mizhuo analyst Jared Holz wrote that Pfizer could use its earnings release to “reject Starboard's argument” or “at least show why its prospects are better than investors currently believe.”

Read more from STAT's Matt Herper.

Novartis postpones submission for MorphoSys drug

Novartis raised its profit forecast this morning, saying the company expects full-year operating profit to grow by a percentage in the high teens, compared to the mid-to-high teens percentages previously forecast.

Separately, however, CEO Vas Narasimhan said it would be “a few more years” before the company could submit to regulators an experimental drug for a rare bone marrow cancer that is the centerpiece of a nearly $3 billion deal for the biotech company MorphoSys represented. This morning's update confirmed previous reports from STAT.

Novartis had originally hoped to apply for approval of the drug this year, but ongoing questions about the data profile still need to be resolved. The company also said it had written off $800 million of the purchase price of MorphoSys.

Read more from STAT's Drew Joseph.

VCs use US startups to hedge bets on Chinese drugs

American venture capitalists are increasingly building U.S.-based companies from the ground up to license and eventually commercialize drugs developed in China.

There is great interest for Chinese biopharma companies in securing new funding from American VCs. And for US investors, the deals are a way to protect themselves when working with Chinese companies. With tensions rising between the US and China, the looming threat of legislation that could make it harder for American companies to invest in China, and uncertainty over the impact of the US election, some VCs are eyeing the idea of ​​starting new ventures in the US establish, as a strategic strategy to opportunity.

Read more from STAT contributor Brian Yang.

GSK acquires autoimmune drug candidates

From STAT's Andrew Joseph: The boom in biotech companies trying to adapt cancer immunotherapies for autoimmune diseases appears to be catching the attention of the pharmaceutical industry.

GSK announced this morning that it has acquired an experimental therapy from Chimagen Biosciences that it plans to test in various forms of lupus and possibly other autoimmune diseases. GSK paid $300 million up front for the “T cell engager” therapy called CMG1A46, which Chimagen is already testing in phase 1 trials in leukemia and lymphoma. The deal includes additional milestone payments upon achievement of certain targets.

GSK said it plans to develop a therapy for autoimmune diseases caused by abnormal B cells, including lupus erythematosus and lupus nephritis, and hopes to begin a Phase 1 lupus trial next year. The pharmaceutical giant said the addition of another drug candidate to its immunology pipeline shows the need for different approaches in the field, particularly for patients who do not benefit much from current treatments.

“CMG1A46 offers exciting potential that we are excited to exploit to address unmet needs in lupus and related autoimmune diseases,” GSK chief scientific officer Tony Wood said in a statement.

Who to watch out for in the booming cancer vaccine space

After years of disappointing results, recent data on new personalized cancer vaccines are beginning to show promising results and are triggering a turning point in the field.

Biotech and pharmaceutical companies are engaged in this area of ​​research, and new scientific knowledge is also emerging on various vaccine targets and the development of cancer vaccines for other types of cancer.

My colleague Angus Chen has put together a list of key players to keep an eye on as this space grows rapidly. These include Catherine Wu of Dana Farber, BioNTech co-founders Uğur Şahin and Özlem Türeci, and Vinod Balachandran of Memorial Sloan Kettering.

Read more.

What's Behind Medicare's Drug Price Negotiations?

Meena Seshamani, director of the Center for Medicare, explains in an opinion piece today how CMS conducted the first round of drug price negotiations under the Inflation Reduction Act.

CMS consulted with FDA staff to consider how to incorporate real-world data into its deliberations, she said. During the negotiations, the agency listened to the drug manufacturers and “each side adjusted its offers accordingly as part of the negotiation process.”

For five of the drugs, CMS reached an agreement during the bargaining session, with the agency agreeing to the prices negotiated by the manufacturers in four cases, she wrote. For the other five drugs, all manufacturers accepted the final offers from CMS, she said.

Read more.

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