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Pipeline Prospector Sept 2023: Pharma indices dip further; Merck, BioCardia hit by trial setbacks
Biotech indices underperformed in September. The downward trend witnessed in August got accelerated last month — the Nasdaq Biotechnology Index slipped by 5 percent, at US$ 3,953.65 in September. It was up by 1 percent, at US$ 4,150.80, in August. The SPDR S&P Biotech ETF index was down 10 percent in September, at US$ 73.02. It was down by 4 percent in August, at US$ 80.15. The S&P Biotechnology Select Industry Index (SPSIBI) was down by 10 percent, at US$ 5,694.34, as against a drop of 5 percent, at US$ 6,161.27, in August.
Stocks for companies such as Roche, Merck, and Alnylam fell due to news of adverse US Food and Drug Administration (FDA) decisions and failures in clinical trials. Coupled with this was the continued shrinking of demand for Covid vaccines and therapies, and this led to stock market losses for Pfizer (stock down 8 percent), Moderna ( stock down 9 percent) and BioNtech (stock down 10 percent).
September was also a lackluster month for deals — no deal above US$ 1 billion got reported. Among the sub-US$ 1 billion deals, Alfasigma’s acquisition of US liver disease drugmaker Intercept Pharmaceuticals for up to US$ 800 million was of significance. This buyout will expand Alfasigma’s range of treatments for liver diseases and digestive system disorders.
Access the Pipeline Prospector Dashboard for September 2023 Newsmakers (Free Excel)
Delayed FDA decision drags Roche’s stock; Novo hit by quality lapses at US plant
In early September, FDA delayed its decision on the subcutaneous version of Roche’s cancer immunotherapy Tecentriq. Roche needs to update Tecentriq’s manufacturing processes as per FDA’s evolving requirements, and the Swiss drugmaker now expects to receive an approval in 2024. Overall, Roche’s stock was down 8 percent last month.
Alnylam’s stock tumbled by 13 percent after FDA’s advisory committee recommended its RNA interference therapy, Onpattro, albeit with caveats. It voted nine to three, saying the benefits of Alnylam’s Onpattro outweigh the risks for patients with transthyretin amyloid cardiomyopathy. However, the committee suggested that the treatment will only be useful to patients who worsen while receiving Pfizer’s rare and fatal heart disease drug, tafamidis. Though patients treated with Onpattro showed improvements in symptoms, Pfizer’s drug has a proven benefit on mortality.
In other regulatory news, FDA issued a complete response letter (CRL) to ARS Pharmaceuticals (stock down 50 percent) for Neffy, an epinephrine nasal spray, to treat allergic reactions.
Novo Nordisk’s stock fell after reports that back in May, FDA had found lapses in quality control to prevent microbial contamination at its Clayton, North Carolina plant. The Clayton facility produces semaglutide, the active ingredient used in its blockbuster weight loss and diabetes drugs Wegovy and Ozempic. Overall, Novo’s stock was down 2 percent in September.
Bristol Myers Squibb faced a new lawsuit filed by Blue Cross and Blue Shield of Louisiana that accused it of using fraudulent patents and other illegal tactics to maintain its monopoly on blockbuster blood cancer drug Pomalyst for years. Its partner 2seventy Bio said in a statement that it anticipates a decline in Abecma sales in the third quarter. “The US revenue for Abecma could be lower than the US$ 470 to US$ 570 million range previously projected,” 2seventy Bio said in a statement. Overall, BMS’ stock fell by 6 percent last month.
Access the Pipeline Prospector Dashboard for September 2023 Newsmakers (Free Excel)
Merck, Acelyrin, BioCardia stocks take a hit due to failures in clinical trials
A combination of Merck (stock down 5 percent) and Eisai’s (stock down 13 percent) drugs Keytruda and Lenvima witnessed another loss as it failed in a phase 3 clinical trial for non-small cell lung cancer (NSCLC). The combo failed to meet both the primary endpoints of overall survival and progression-free survival in two separate lung cancer studies. Earlier in 2023, the same combo had failed in melanoma, colorectal cancer and head and neck squamous cell carcinoma.
Among small-cap companies, Acelyrin’s experimental lead drug izokibep failed to meet the main goal of a mid-to-late stage trial to show statistically significant reduction in abscesses and inflammatory nodules compared to placebo in patients with hidradenitis suppurativa (HS), a chronic inflammatory skin condition. Its stock was down 64 percent in September. Similarly, BioCardia’s stock took a 100 percent dive as the company’s CardiAMP cell therapy failed in a phase 3 heart failure trial.
Access the Pipeline Prospector Dashboard for September 2023 Newsmakers (Free Excel)
GSK gains post cancer drug approval; AbbVie, Novartis post trial-related gains
Companies like GSK, AbbVie (stock up 3 percent), Novartis (stock up 3 percent), and Immunovant saw their share prices move upwards during September. GSK (stock up 6 percent) gained as its oral cancer med, momelotinib, was approved by the FDA. It is the first and only treatment for a type of bone marrow cancer known as myelofibrosis patients with anaemia.
There was more good news from GSK — the European Commission authorized GSK’s HIV-focused unit ViiV Healthcare’s cabotegravir, a pre-exposure prophylaxis to reduce the risk of sexually-acquired HIV-1 infection in high-risk adults and adolescents.
AbbVie had a good month. One, AbbVie’s autoimmune medicine Skyrizi is poised to give Johnson & Johnson’s (stock down 2 percent) blockbuster arthritis therapy Stelara a run for its money. In a late-stage head-to-head study in Crohn’s disease, Skyrizi matched up to Stelara in terms of inducing clinical remission in patients with active, moderate to severe Crohn’s disease who had failed on traditional anti-TNF agents. Two, AbbVie is set to receive US$ 480.6 million in damages from Takeda over a supply agreement dispute for Lupron, as per a court verdict.
Novartis announced data from a late-stage trial that showed how health-related quality of life scores had increased in patients treated with Kisqali, its cancer drug, when used in combination with endocrine therapy (ET) compared to those treated with ET alone. This finding suggested that Kisqali reduced the risk of cancer recurrence without adding to the burden of care.
Meanwhile, Novartis confirmed plans for Sandoz spin-off on October 4. Sandoz also announced partnership with Samsung Bioepis to develop and commercialize a Stelara biosimilar.
Mid-cap company Immunovant saw its stock surge by 71 percent last month after early-stage data from its experimental antibody IMVT-1402 to treat autoimmune diseases exceeded analysts’ expectations. The drug is set to compete with treatments from companies like J&J and UCB, all of which are in the development stage.
Access the Pipeline Prospector Dashboard for September 2023 Newsmakers (Free Excel)
Our view
September was the worst month of 2023 with S&P 500 dropping by 5 percent and the Nasdaq falling by 6 percent. Overall, the market was reacting to several concerns in the US economy such as rising interest rates, a slowing down of the housing market and signs that households are tightening their belts.
Given these concerns, it’s unlikely that the coming months will be dramatically different for the biopharma industry. Let’s hope the tide turns in 2024.
Access the Pipeline Prospector Dashboard for September 2023 Newsmakers (Free Excel)
Pharma & Biotech Newsmakers in September 2023
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