Friday, March 6, 2015

Merck's Pivotal VSV-EBOV Vaccine Candidate Study Begins -- In Guinea. . . Tomorrow.

As our regular only too well readers know, we believe that Merck likely has the most efficacious Ebola vaccine candidate (at least most efficacious -- among those in highest state of readiness), so it makes sense that it will be tested first, in Guinea -- to prevent outbreaks among people known to have had contact in the wild with any given confirmed Ebola patient. Sadly, Basse Guinée is still seeing significant numbers of new cases, and so that's where the trial will begin.

Here's a good piece on it all from PharmaTimes:

. . . .The World Health Organisation, the Health Ministry of Guinea, Médecins Sans Frontières, Epicentre and The Norwegian Institute of Public Health will test VSV-EBOV for efficacy and effectiveness in preventing the killer disease.

Vaccination will take place in areas of Basse Guinée, which has the highest number of cases in the country, and the strategy adopted will be “ring vaccination”, which involves identifying a newly diagnosed case of Ebola – the ‘index case’ – and then tracing of the patient’s contacts, who are then vaccinated.

The dual objectives of the trial are to assess if VSV-EBOV protects the contacts who were vaccinated and if this will successfully create a buffer around the index case to prevent further spread of infection. . . .

Here's to hoping -- that VSV-EBOV. . . is the Lord. . . of the Rings. Quiet Friday nights -- to one and all, now.

No Surprise Here: Kenilworth Shutters Various Early Stage R&D Programs At Legacy Cubist Lexington, MA Hub, Post Close

FiercePharma does a nice job of putting the contextual map in place, on these 120 science job eliminations, post the close of Merck's acquisition of Cubist. [Backgrounder, from yours truly, here.]

Anyone who's handled life science M&A in this size range wouldn't be surprised by this development -- but it is still a tough pill to swallow, in Lexington, Massachusetts. Doubly so, for the affected families. A bit from FiercePharma's Damian Garde, quoting the Boston Business Journal, here -- but do go read it all:

. . . .As the Boston Business Journal reports, the company informed employees today that it's backing away from the antibiotic specialist's drug discovery efforts, dialing down operations at Cubist's Lexington headquarters but promising to keep up work on later-stage products. Merck told the BBJ that it plans to keep at least some of Cubist's preclinical candidates in development, transferring them to other R&D sites.

The move marks Merck's first major cuts to Cubist after wrapping up a $9.5 billion buyout in January. Merck expects the acquisition to add about $1 billion to its 2015 revenue, but the pharma giant is apparently less than committed to following through on Cubist's plans for major spending on antibiotic R&D. . . .

Let's hold a good thought for the affected families. . . And so, do drive safely, one and all. . . good ju ju goes out to you all, this Friday. Namasté, and may The Infinite ride with each of you.

Off Topic Friday: NASA's Dawn Spacecraft Enters Orbit Around Ceres Later Today. . .

Okay -- you know I have to break off topic, here on a Friday morning to ask. . . what are those two glowing, and iridescent disks in the larger northern craters -- on Ceres? What in heaven's name would shine. . . like that?

From NASA, then -- an astrological mystery:

. . . .NASA’s Dawn spacecraft has returned new images captured on approach to its historic orbit insertion at the dwarf planet Ceres. Dawn will be the first mission to successfully visit a dwarf planet when it enters orbit around Ceres on Friday, March 6.

"Dawn is about to make history," said Robert Mase, project manager for the Dawn mission at NASA’s Jet Propulsion Laboratory (JPL) in Pasadena, California. "Our team is ready and eager to find out what Ceres has in store for us." Recent images show numerous craters and unusual bright spots that scientists believe tell how Ceres, the first object discovered in our solar system’s asteroid belt, formed and whether its surface is changing. As the spacecraft spirals into closer and closer orbits around the dwarf planet, researchers will be looking for signs that these strange features are changing, which would suggest current geological activity. . . .

As I've long held -- big science equals. . . big fun!

Thursday, March 5, 2015

As I Said Over A Year Ago -- The Lead In This $16 Billion (2017) Market Belongs To. . . BMS's Opdivo®

Only a few days after granting it a priority review, FDA cleared nivolumab (branded as Opdivo®) for use in metastatic lung cancers. Just as I guessed back in February of 2014, the BMS trial data was in fact so robust, BMS was able to pivot quickly toward approval -- and the FDA was comfortable approving this life saving biologic essentially. . . immediately.

And, even though it clearly gives BMS first mover advantages in a very high burden of disease sector in the US, Merck does get the back-handed benefit that this is a ringing endorsement of the anti-PD-1 approach. So, when Merck does submit (likely closer to June 2015) a biologic license application for NSCLC to FDA, it too might see a pretty rapid FDA approval. The $16 billion to $35 billion a year juggernaut begins. From the FDA overnight, then:

. . . .The U.S. Food and Drug Administration today expanded the approved use of Opdivo (nivolumab) to treat patients with advanced (metastatic) squamous non-small cell lung cancer (NSCLC) with progression on or after platinum-based chemotherapy. . . .

Lung cancer is the leading cause of cancer death in the United States, with an estimated 224,210 new diagnoses and 159,260 deaths in 2014. The most common type of lung cancer, NSCLC affects seven out of eight lung cancer patients, occurring when cancer forms in the cells of the lung.

Opdivo works by inhibiting the cellular pathway known as PD-1 protein on cells that blocks the body’s immune system from attacking cancerous cells. Opdivo is intended for patients who have previously been treated with platinum-based chemotherapy.

“The FDA worked proactively with the company to facilitate the early submission and review of this important clinical trial when results first became available in late December 2014,” said Richard Pazdur, M.D., director of the Office of Hematology and Oncology Products in the FDA’s Center for Drug Evaluation and Research. “This approval will provide patients and health care providers knowledge of the survival advantage associated with Opdivo and will help guide patient care and future lung cancer trials.”

Opdivo’s efficacy to treat squamous NSCLC was established in a randomized trial of 272 participants, of whom 135 received Opdivo and 137 received docetaxel. The trial was designed to measure the amount of time participants lived after starting treatment (overall survival). On average, participants who received Opdivo lived 3.2 months longer than those participants who received docetaxel. . . .

My guess is that Kenilworth is likely about nine to twelve months behind BMS in lung cancer. Onward.

Wednesday, March 4, 2015

UPDATED -- Mid Arguments: King v. Burwell Prediction -- ACA Stands; Petitioners Lose

All the conjecture aside -- I do now know this: Either Chief Justice Roberts, or Justice Kennedy, will almost certainly provide the swing vote -- in this case. The Chief Justice asked no questions, so his position is largely occluded. . . opaque.

Justice Kennedy however, has made some clear waves -- trouble, that is, for the petitioners -- and pretty openly suggested that their reading of the "five words" would lead to some absurd results. Ones, we may reliably infer, Congress would not have intended. A little earlier, Justice Kagan laid a trap for the hapless petitioners, and they fell right into it. They are in well over their heads. Both are quoted below, from the very fine

. . . .[Justice Kagan] offered (something like) the following example: Imagine I tell law clerk A to write a memo, and law clerk B to edit law clerk A’s memo, and then I tell law clerk C to write such memo if law clerk A is too busy. And imagine that happens – law clerk A is too busy, so law clerk C writes it. Should law clerk B edit it? The answer seemed obvious: of course, and Justice Kagan all but told petitioner’s counsel (and her clerks) that they would be fired if they didn’t do their job under those circumstances. In response, petitioner’s counsel said that the context mattered, and it would depend on whether the Justice was indifferent between law clerk A and law clerk C writing the memo in the first instance. But that seemed to play into Justice Kagan’s hand, who made clear that this was her point – that in understanding this text, the context obviously mattered.

That turn to context seemed unprofitable initially for petitioners. Many Justices, including Justice Breyer, Justice Sotomayor, and Justice Kennedy expressed skepticism that the statute would function as intended, in a reasonable fashion, and even constitutionally if petitioners’ reading were accepted. . . .

For those less immersed in the legal niceties, however, I think the key takeaway is that – in a case that seemingly pits literalism against contextualism – Justice Kennedy was very attentive to the consequences of the reading that petitioners urged. He seemed to realize that state legislators would be in an impossible position under that reading – more or less forced to “adopt” or “endorse” the ACA system in order to avoid unmanageable consequences in their states. His plausible conclusion was that Congress either did not intend to put them to that choice, or that the statute shouldn’t be read to have done so, because that’s not typically how our constitutional system works. Instead, the federal government makes and administers federal laws without forcing the states to do some of the work for them. Kennedy seemed to be thinking that this provision should be read more like the typical case, and rather unlike the kind of unusual provision the petitioners suggested. . . .

Justice Kennedy might believe that Congress would not have intended to set up such a dubious system; he might believe that this reading is required but actually unconstitutional (so that he would strike down the statute’s condition that subsidies apply only to exchanges established by the state); or – perhaps most likely – he might believe that the statute should be interpreted so as to avoid the “serious constitutional problem” he identified. . . .

So -- we shall see. Onward -- and "Forward". Background here.

Fascinating: NOT "Paying for Prescriptions, Or Referrals" -- But Paying -- To Provide "Point Of Treatment" Alerts(?)

Yesterday's Wall Street Journal ran a story that deserves a little more thoughtful analysis -- related to the Merck Vaccines business units, and the intersection of inexorable commerce -- with increasingly common electronic patient care record-keeping. [And I guarantee you, many a family practice doc from the 1960s. . . would be moderately aghast -- at this new world. This isn't a "free sample" world, any longer -- at all.]

While several companies have offered various versions of this "instant alert" app/pop-up to doctors' iPads, phones or laptops as available tech for a few years, I for one was not aware that the vaccine makers, like Merck, were paying for the placements, to subsidize the app/software. And I was not aware that the latest business models include a "give-away" of the software -- to the point of care provider. Cheeky!

It strikes me that all of this is certainly lawful, so long as all interested parties are informed (patients included) that the doctor is getting a freebie, and a multinational pharma -- like Merck -- is covering the cost of that freebie, plus a profit margin for the software/app vendor. [Background on the other stories embedded in the graphic, at right, here.] Even so, the doctor featured in the article said he was unaware that Merck was paying for the pop-ups. As I say, a fascinating. . . . new world, indeed. From yesterday's Wall Street Journal, then -- a bit:

. . . .When Allan Treadwell views patient charts on his computer, a yellow alert sometimes pops up—a handy feature that tells him when a patient is due for vaccines for hepatitis B, influenza or other ailments.

“It’s a nice safety net,” said Dr. Treadwell, an internist in San Francisco.

Dr. Treadwell isn’t the only one who is pleased with the alerts. So is Merck & Co., which pays for the notifications sent to Dr. Treadwell and 20,000 other health-care providers. Medical-record software startup Practice Fusion Inc., which sells the alerts and displays them through its software, said that during a four-month study period ending in August, it observed a 73% increase in vaccinations—amounting to 25,000 additional treatments—compared with a control group. The company didn’t disclose its fees for delivering sponsored alerts but said it doesn’t take a cut of sales that result. . . .

I certainly think in at least a few vaccine arenas, for example, where Merck is the sole source (i.e., has a monopoly anyway), this presents very little concern. But if the pop-up advocates one brand of vaccine over another in a contested space (two or more vaccine makers). . . well, I think that at least raises ethical and disclosure questions for the point of care provider. So -- what does the readership think (as we wait for the transcript from the King v. Burwell oral argument at the Supremes, to become available later this afternoon). . . What do you think?

Tuesday, March 3, 2015

Updated SEC Disclosures -- Regarding The Keytruda® Vs. Opdivo® Patent Fights

UPDATED | 11 PM EST: I checked the PACER electronic docket, and if the current agreed scheduling motion holds, trial in the Delaware federal District Court won't begin until late 2016, or early 2017. So -- I'll lay odds that some set of outcomes, in these other courts around the globe (perhaps the United Kingdom actions), will lead the parties to settle, well before the Delaware trial date arrives. But the probable stakes are preposterously gargantuan. Opdivo® could be raking in north of $8 billion a year by 2017, and my guess on Keytruda® would be about half that. So, if the royalties (in either direction) approach 10 per cent, or are tripled (due to findings of willful infringement), the damages could easily be north of $5 billion over the life of the patents, all in. Yes, this is material litigation -- even if it first appears at page 114 of the SEC Form 10-K. Indeed it is one set of spats. . . to watch. END, UPDATED PORTION.

I'll be back this evening afternoon to explain what all this means to the average Merck investor, on Keytruda®. But make no mistake, this is material litigation, globally for Kenilworth. Backgrounder here.

For now, accept that the proverbial fat lady hasn't even begun to clear her throat. This could still go either way. From page 114 of the SEC Form 10-K, then:

. . . .As previously disclosed, Ono Pharmaceutical Co. (“Ono”) has a European patent (EP 1 537 878) (“’878”) that broadly claims the use of an anti-PD-1 antibody, such as the Company’s immunotherapy, Keytruda, for the treatment of cancer. Ono has previously licensed its commercial rights to an anti-PD-1 antibody to Bristol-Myers Squibb (“BMS”) in certain markets. The Company believes that the ’878 patent is invalid and filed an opposition in the European Patent Office (the “EPO”) seeking its revocation. In June 2014, the Opposition Division of the EPO found the claims in the ’878 patent are valid. The Company received the Opposition Division’s written opinion in September 2014 and the Company submitted its substantive appeal in February 2015. In April 2014, the Company, and three other companies, opposed another European patent (EP 2 161 336) (“’336”) owned by BMS and Ono that it believes is invalid. The ’336 patent, if valid, broadly claims anti-PD-1 antibodies that could include Keytruda. BMS and Ono recently submitted a request to amend the claims of the ’336 patent. If the EPO allows this amendment, the claims of the ’336 patent would no longer broadly claim anti-PD-1 antibodies such as Keytruda.

In May 2014, the Company filed a lawsuit in the United Kingdom (“UK”) seeking revocation of the UK national versions of both the ’878 and ’336 patents. In July 2014, Ono and BMS sued the Company seeking a declaration that the ’878 patent would be infringed in the UK by the marketing of Keytruda. The Company has sought a declaration from the UK court that Keytruda will not infringe the ’336 patent in the UK. It is anticipated that the issues of validity and infringement of both patents will be heard at the same time by the UK court, which has scheduled the trial to begin in July 2015. BMS and Ono recently notified the Company of their request to amend the claims of the EPO ’336 patent and of their intention to seek permission from the court to similarly amend the UK national version so that the claims of the ’336 patent would no longer broadly claim anti-PD-1 antibodies such as Keytruda.

The Company can file lawsuits seeking revocation of the ’336 and ’878 patents in other national courts in Europe at any time, and Ono and BMS can file patent infringement actions against the Company in other national courts in Europe at or around the time the Company launches Keytruda (if approved). If a national court determines that the Company infringed a valid claim in the ’878 or ’336 patent, Ono and BMS may be entitled to monetary damages, including royalties on future sales of Keytruda, and potentially could seek an injunction to prevent the Company from marketing Keytruda in that country.

The USPTO granted US Patent Nos. 8,728,474 to Ono and 8,779,105 to Ono and BMS. These patents are equivalent to the ’878 and ’336 patents, respectively. In September 2014, BMS and Ono filed a lawsuit in the United States alleging that, by marketing Keytruda, the Company will infringe US Patent No. 8,728,474. BMS and Ono are not seeking to prevent or stop the marketing of Keytruda in the United States. The trial in this matter is currently scheduled to begin in November 2016. The Company believes that the 8,728,474 patent and the 8,779,105 patent are both invalid.

In September 2014, the Company filed a lawsuit in Australia seeking the revocation of Australian patent No. 2011203119, which is equivalent to the ’336 patent.

Ono and BMS have similar and other patents and applications, which the Company is closely monitoring, pending in the United States, Japan and other countries.

The Company is confident that it will be able to market Keytruda in any country in which it is approved and that it will not be prevented from doing so by the Ono or BMS patents or any pending applications. . . .

What it does not say is whether Merck will be able to charge a royalty -- or have to pay one -- to keep Keytruda on market in various jurisdictions. It also gives no hint as to what those royalties might do to profitability. More later.

Monday, March 2, 2015

Merck (Actually Legacy Schering-Plough) Has ANOTHER Bridion® Advisory Committee Date: March 18, 2015

Merck filed its annual report on SEC Form 10-K -- at the EDGAR virtual window, late Friday. As I read it over more closely this evening, I was reminded that Merck/Schering-Plough had tried thrice before to gain FDA approval of Bridion® -- but no dice.

It is up for committee vote again, the day after St. Patrick's, this year -- and maybe the luck of the Irish, and some of the "fourth third time -- as a charm" ju ju will help.

We shall see. But once again, a 2007-era "Fast" Fred Hassan-designated "star", is still not on market in the US -- almost eight years later. Ugh. From the Merck SEC Form 10-K, then (at Page 46):

. . . .In September 2013, the Company received a CRL from the FDA for the resubmission of the NDA for Bridion. To address the CRL, the Company conducted a new hypersensitivity study and, in October 2014, resubmitted the NDA to the FDA. The Company anticipates an FDA advisory committee meeting will be held on March 18, 2015 to review Bridion. If approved, the Company expects to launch Bridion in the United States later in 2015. . . .

Let's hope Kenilworth is packin' shamrocks, shillelaghies and. . . a few tall leprechauns that day!

What a tortured path this operating suite drug candidate has endured -- largely due to legacy Schering mismanagement of the studies, and miscalculations in the FDA filing strategy, in that legacy law department. So it goes. Maybe 2015 will be its year. It feels a lil' like my. . . Cubs. Smile.

Merck's Adam Schechter At Cowen & Co. Health Care Conference Tomorrow Morning In Boston

He's not likely to make any real news in Boston tomorrow, but we'll likely listen in just the same. [I suppose he might comment on BMS getting priority review for Opdivo®, in NSCLC -- and Merck's catch-up plans.] We may liveblog any real news:

. . . .Adam Schechter, executive vice president and president, Global Human Health, Merck, is scheduled to present at the 35th Annual Cowen Health Care Conference in Boston on Mar. 3, 2015 at 8:40 a.m. EST.

Investors, analysts, members of the media and the general public are invited to listen to a live audio webcast of the presentation. . . .

So, do stop back by -- around 8:40 Eastern tomorrow morning. I doubt he'll discuss anything new and material -- but who knows?

Sunday, March 1, 2015

FDA Grants Priority Review To BMS's Opdivo® -- In Previously-Treated Lung Cancers

And with this Friday afternoon news, just as I predicted, BMS has seized the lead in a "significant burden" oncology line (NSCLC), over Merck's Keytruda®.

For its part, Merck expects to file in the first half of 2015 -- but that likely puts Merck more than six months behind BMS's Opdivo®. Just as I said over a year ago, now.

From the BMS press release, then:

. . . .BMS today announced that the U.S. Food and Drug Administration (FDA) has accepted for filing and review the Biologics Licensing Application (BLA) for Opdivo (nivolumab) for the treatment of patients with advanced squamous non-small cell lung cancer (NSCLC) after prior therapy. The FDA also granted Priority Review for this application. The Prescription Drug User Fee Act (PDUFA) goal date for a decision is June 22, 2015. . . .

So. . . now Merck will be playing "catch up" in NSCLC. Ouch.

Prediction: The Supremes Will Toss King v. Burwell -- The ACA of 2010 Was Intended "To Achieve Near Universal Coverage"

This coming week, the US Supreme Court will hear oral arguments in King v. Burwell -- yet another tempest in a teapot, engineered by the hubris of a few -- who hope to undo the lawful will of. . . the many.

As most of the better legal scholars have noted -- despite much of the right-leaning hullaballoo -- this case isn't really about very much. It is yet another attempt to invalidate a central component of a 900 page statute, by positing a befuddling, and counter-intuitive reading of five words in one subsection -- a subsection that deals with calculating the AMOUNT of a subsidy; not whether the subsidy should exist at all. It is beyond serious dispute that Congress intended to create near universal coverage in passing the ACA of 2010.

And so, it is the position of many legal scholars (who follow these matters closely) that the Supremes have agreed to take the case precisely to put to a final, non-appealable death the notion that five words may ever be a place where Congress intentionally hides an elephant -- deep inside a. . . mousehole.

And the central job of the Supremes here -- having already ruled that the ACA of 2010 was a valid exercise of Congressional power -- will be to uphold the intent of the Congress in passing a valid, necessary and proper (albeit complex) 900 page statute. From the excellent amicus brief of HCA, a large Tennessee based corporate hospital chain, then -- a bit of the persuasion:

. . . .In Petitioners’ view [the parties seeking to overturn this ACA provision], however, Congress made residents of every state eligible for a subsidy, only to then deny subsidies to every resident of certain states through the application of a formula for calculating the amount of the subsidy. Specifically, because the amount of the subsidy is tied to the cost of a plan offered on an “Exchange established by the State,” id. § 36B(b)(2)(A), Petitioners argue that the calculation works out to $0 for every resident of a federally-facilitated Exchange state.

Congress does not hide “elephants” in such “mouseholes.” Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001). No member of Congress – not to mention the millions of Americans who have relied on the promise of subsidies and are now overwhelmingly satisfied with their coverage – would have understood these five words buried in a formula as making the promise of affordable coverage illusory for large swathes of the population.

The text of the statute confirms what common sense suggests: the ACA’s subsidy-calculation provision does not have the massive import Petitioners seek to give it. Rather, the ACA’s definitions make clear that every “Exchange” is treated as “established under section 1311” – the section obligating states to establish Exchanges – even when the federal government is in fact operating the Exchange under section 1321. 42 U.S.C. § 300gg–91(d)(21). Section 1311 itself specifies that every Exchange is, by operation of law, “a governmental agency or nonprofit entity that is established by a State.” 42 U.S.C. § 18031(d)(1) (emphasis added). And in directing HHS to operate “such Exchange,” Congress confirmed that a federally-facilitated Exchange under section 1321 is still, for statutory purposes, an Exchange established by the state under section 1311. ACA § 1321, 42 U.S.C. § 18041(c)(1). Together, these provisions make clear that Congress used “Exchange established by the State” in § 36B as a statutory term of art, not as a roundabout way to deny affordable coverage to residents of states that decline to run their own Exchange. . . .

Petitioners’ interpretation cannot be accepted for the additional reason that it would “undermine in a substantial way the [statute’s] purpose.” Maracich, 133 S. Ct. at 2200. There is no need to resort to legislative history to divine the fundamental legislative purpose of the ACA, because the statute makes it plain: “achiev[ing] near-universal coverage. . . .”

The fundamental question in this case is whether the ACA is in fact “a comprehensive national plan to provide universal health insurance coverage,” NFIB, 132 S. Ct. at 2606 (2012) (op. of Roberts, C.J., joined by Breyer & Kagan, JJ.), or instead contains a trap door through which millions of Americans may fall. Every tool of statutory interpretation indicates that Congress intended the former. With subsidies available on the federally-facilitated Exchanges, the newly insured are able to take personal responsibility for their care, emergency room usage is dropping, women are gaining access to needed care, and the costs and benefits of expanding coverage are being shared throughout the health care system.

Without the subsidies, an otherwise coherent regulatory scheme may come apart at the seams: the newly insured could lose coverage, the positive trends in the delivery of care noted above could be reversed, the economic logic of the ACA could be disrupted, the federally-facilitated Exchanges could slide into dysfunction, and even the previously insured could lack access to a viable alternative market.

This Court should follow the interpretation that makes sense of the ACA’s interconnected provisions. That interpretation is that subsidies are available to every “applicable taxpayer,” without regard to whether his or her state has elected to run its own Exchange. . . .

Of course you will read much right leaning rhetoric suggesting that. . . the ACA of 2010 sky is about to fall. You may safely ignore it. You heard it here first. [A very good, plain English version of this discussion appears on the editorial pages of The New York Times, this Sunday morning, as a light silvery snow drifts down here, once again. Fly safely one and all.]

Saturday, February 28, 2015

Legacy Schering-Plough Zenhale® Inhalers Recalled -- In Canada Only

Not material to Merck overall -- but noteworthy for its legacy attachment to the Schering-Plough OTC version Nasonex® franchise.

OTC Nasonex (a product and brand now owned by Bayer -- as part of that consumer health transaction) contains some of the same active ingredient as the Zenhale product in Canada. See graphic at right. Here is the relevant Health Canada notice, in any event -- and a bit:

. . . .Merck Canada is initiating a recall of certain lots (see attached list) of Zenhale at the pharmacy/physician level due to the possibility of device malfunction after 24 months shelf-life, resulting in the potential for a patient to receive a lower dose than expected. The company’s investigation has determined that the occurrence of this defect is low.

Merck Canada expects new [inhaler] product to be available in pharmacies by March 23, 2015. Merck Canada will reduce the shelf life of all Zenhale products from 36 months to 24 months. The new product will have a shelf-life of 24 months. . . .

So it goes -- all remedied by March 23, 2015. Thus immaterial. Now, here on a snowy Saturday night -- going to catch up and see Kingsman. . . .UPDATE: it was horrific -- as in an atrocious waste of time.

Friday, February 27, 2015

WHO/SAGE Indicate "No Decision" -- On Mass Ebola Vaccinations -- Until At Least August 2015

Clearly, the recent and heartening reduction in the year long outbreak (the world's worst, thus far) is stretching the time line, but that is net, net, a good thing. And clearly we need to see the immune response is durable in the wild -- in the real world. So we will need to be patient here. I am encouraged. And I am sure Merck and New Link are, too. As are GSK and J&J.

Here's the Reuters bit, overnight:

. . . .WHO spokesman Christian Lindmeier, reporting on a three-day meeting of experts, told a news briefing: "Vaccine introduction is by no means a given and will depend on the results of clinical trials and recommendations from WHO's Strategy Advisory Group of Experts (SAGE) on vaccines and immunization.

"The earliest that the SAGE is expected to make recommendation on a wide-scale introduction is August. Decisions on whether or not to introduce the vaccine will be made by the respective ministries of health of countries. . . ."

WHO spokeswoman Margaret Harris said: "We know the vaccines are safe, we know they produce a good immunogenic response in humans, but we don't know if they are effective when you actually have disease in community."

Guinea, Liberia and Sierra Leone reported 99 new confirmed Ebola cases in the week to Feb. 22, down from 128 the previous week, the WHO said on Wednesday. . . .

So, encouraging declines in new cases continue. . . and Merck will of course "do the right, as it sees. . . the right." For my part, I'll keep hoping. . . for "hope is a good thing -- perhaps even the best of all things. . . ." Onward.

Jefferies & Co. Continues To See-Saw, On Merck

The last move from this house was up to $69 -- now back to $63 (where, in November 2014, the analysts had it prior to the "breakout" $69 level) -- so, the see-saw on near term NYSE price targets for Kenilworth continues.

Always a "Hold" -- neither a "Buy" or "Sell". . . In the context of other large cap pharma concerns -- here is the landscape, at the moment:

. . . .Jefferies Group has also taken action a number of other healthcare stocks recently. The firm raised its price target on shares of Pfizer Inc. from $40.00 to $42.00. They have a buy rating on that stock.

Also, Jefferies Group reiterated its hold rating on shares of Merck & Co., Inc.. They have a $63.00 price target on that stock, down previously from $69.00.

Finally, Jefferies Group reiterated its buy rating on shares of Eli Lilly and Co. They have a $87.00 price target on that stock, up previously from $80.00. . . .

Happy Friday, one and all. Be safe; be warm.

Thursday, February 26, 2015

The Company That Acquired Merck's Boulder Bio Operations -- Has Itself Been Acquired -- By A Trio Of Investment Companies

Back in May of 2014, we reported that KBI BioPharma had purchased Merck's microbial lines API capabilities in Boulder, Colorado. Long before that, we had reported in early-2010 that Merck had itself acquired the facilities from a third party, called Insmed (with additional nuances here).

Here's the bit from Genetic Engineering & Biotechnology News:

. . . .KBI says its capabilities include delivering expert and integrated process development and cGMP manufacturing of recombinant protein active pharmaceutical ingredients (API). Among clients offering testimonials on KBI’s website are Auxillium Pharmaceuticals (acquired by Endo International for $2.6 billion in a deal completed January 29), DynPort Vaccine (a CSC company), Elusys Therapeutics, Trans Tech Pharma, and UCB Celltech.

KBI expanded to Boulder last year, when it bought the microbial process development and manufacturing operations of Merck & Co. for an undisclosed price. As part of that acquisition, KBI agreed to provide ongoing development and manufacturing services to Merck, as well as to third-party customers. . . .

So it goes -- this Boulder bunch has a great pedigree and does excellent science. But it sure has been passed around a bit -- and on very short round-trips, too. I'm just sayin'. . .

An Update -- On Gilead's Tax Haven Utilization -- For Its Sovaldi® Juggernaut

Since we have long followed the way Gilead's Sovaldi® has all but crushed the life out of both Vertex's and Merck's last gen Hep C drugs (which were revolutionary in their day), I thought the readership might enjoy an update on how the Sovaldi train is running, ex-US.

Tonight, the Chicago Tribune has a nicely nuanced story -- about how effective Gilead has become, in sheltering its Sovaldi income from US taxation. [It shouldn't entirely escape notice, however, that Gilead's chief competitor here, Abbott Labs, calls the Chicagoland area home -- and so this is a bit of home town boosterism, in a back-handed way. Boosterism, by casting an unflattering light on Gilead's Irish haven operations.] here is a bit of the Trib story -- do read it all:

. . . .The company reported foreign income before taxes of $8.2 billion for 2014, earning more in non-U.S. profits than it recorded in non-U.S. sales. The data released in a securities filing Wednesday suggest that Gilead is taking advantage of U.S. rules that let companies shift valuable intellectual property to low-tax countries, said Robert Willens, an independent tax consultant based in New York.

"Whenever you have huge, very high profit margins and a lot of income as well, it almost always results from the exploitation of intangibles," Willens said in a telephone interview. "It's quite a dramatic increase from one year to the other. That's something you don't see very often. . . ."

When a multi-national company (with dozens of subsidiaries) records more net income -- than sales -- in a given non-US geography, it must mean that the US entities in the chain are paying a hefty patent royalty on each dollar of their own sales, in the US -- to the patent holding company (usually a parent or subsidiary in Ireland, or a Benelux jurisdiction).

This is plainly defensible for truly ground breakingly revolutionary drugs -- the heart of which rely upon extremely valuable inventions, or intellectual property -- usually patented.

So it would seem, as to Gilead. Fascinating, and good tax planning -- sez me.

NICE To Routinely Reimburse For Merck's Remicade®: United Kingdom Good News

While this expansion of coverage probably won't counter the erosion from bio-similars, it is good news for Merck's non-US operations. We will keep an eye out for Pound Sterling revenue trend lines, in the first and second quarters of 2015.

Here's a it, from PharmaTimes:

. . .Merck Sharpe & Dohme’s Remicade (infliximab) and Simponi (golimumab) and AbbVie’s Humira (adalimumab) will be routinely funded on the NHS to treat the chronic bowel condition in patients with moderate to severe disease, significantly expanding access to these biologics.

Around 146,000 people in the UK live with UC, and the new recommendation means that more options are available to patients giving them a greater chance of controlling symptoms “so they can have a much better quality of life,” said Carole Longson, NICE Health Technology Evaluation Centre Director. . . .

Onward -- out, into the snow!

Wednesday, February 25, 2015

Launch Day! -- Euro Biosimilar to Merck's Remicade®

The estimate is that over the next decade, over $100 billion of value will be transferred away from branded makers, to the bio-similar producers, in the class of biologics overall.

It begins in earnest, for Merck, today. Here is Reuters on it:

. . . .Paul Greenland, head of biologics at Hospira, said that biosimilars are likely to be priced about 20-30 percent cheaper than originals.

Because biotech drugs are made from living cells it is impossible to manufacture exact copies, as happens with simple chemical medicines, so regulators have come up with the notion of approving products that are similar enough to do the job.

Remicade, which has annual European sales of about 2 billion euros ($2.3 billion), and the two biosimilar copies all contain an antibody known as infliximab. . . .

Probably at least a 15 per cent down bubble in sales of Remicade®, over the next three years, in the EU then -- for Kenilworth. But it is priced into today's NYSE quote.

Tuesday, February 24, 2015

Once Again, Doing Well -- And Doing The Good. . . Isentress® Access For Limited Means HIV+ Children Globally

The Medicines Patent Pool announced this morning that Merck, via MSD, has granted non-exclusive licenses in up to 92 limited means countries, for pediatric raltegravir dosings.

This is both moral, and smart, business. Merck follows on the heels of its iDesign HIV Awareness and patient assistance programs with this humanitarian effort. My hat is off to the team that made it happen. From ABC News, then:

. . . .Drugmaker Merck & Co. has granted a free license allowing one of its HIV medicines to be made and sold inexpensively for use in young children in poor countries hard hit by the AIDS virus. . . .

The deal, announced Tuesday, lets any generic or brand name drug manufacturer make low-cost pediatric versions of Merck's raltegravir for sale in 92 low- and middle-income countries, according to the Medicines Patent Pool. The group, backed by the United Nations, works with brand-name drugmakers to find ways to make their HIV medicines still covered by patents available in developing countries for a fraction of the price charged in Europe or the United States. . . .

Of course, MPP officials have renewed their call for Merck to make the life-saving drug available to adults, under a similar license. I don't expect that Kenilworth will agree to that. There is just too great a risk of it being pirated, and resold in the post industrial world -- undercutting Merck's perhaps $1 billion invested in bringing Isentress® to market, globally.

Monday, February 23, 2015

Ed Silverman: New Merck's "Old School" Biotech Collaboration With NGM Bio

More later -- but this is fascinating. Up to $450 million over five years -- and a "go wherever your head & gut lead you" mandate. Amazing.

LATER UPDATE: Here is a rather breathless account of the deal's back and forth -- from Bloomberg. I'll not need to add. . . anything to that link. I guess Roger has known the NGM folks since at least 2004, at Amgen.

In any event -- from that gent, Ed, who had it first -- at Pharmalot, then:

. . . .Merck will provide a $94 million upfront payment and a $106 million equity investment for a 15% stake, and also fund $250 million of NGM R&D projects over the next five years, although NGM has full authority to control R&D. Merck R&D chief Roger Perlmutter and NGM chief scientific officer, Jin-Long Chen, by the way, once worked together at Amgen. . . .

Off to court, and other sundry duties!