Friday, July 29, 2016

Merck's Mixed Bag: Q2 2016 -- And Full Year 2016 Monochrome Edition


I've been sputtering, and late on getting to this -- actually kinda' felt like just "phoning it in" today -- thus the gray-scale graphic, at days' end.

Merck posted a pretty solid Q2 2016 -- but lowered and narrowed its EPS ranges for the full year. You may wish to read the very-capable Linda Johnson's take on it all here (with a bit of it, quoted in blue, below). For the year (in relatively good news not being widely reported), Kenilworth expects that currencies will only be a two per cent headwind, at the revenue line:

. . . .The second-biggest U.S. drugmaker is countering the fiercely competitive pharmaceutical industry's emphasis on short-term results, instead prioritizing steadily building market share in the hot categories of hepatitis C and immune system-boosting cancer drugs. Both Keytruda and Zepatier trail rival drugs that had a head start and dominate those multibillion-dollar markets.

Merck executives said Friday they're working on catching up as they win broader insurance coverage and as continuing patient studies provide more evidence the two drugs outperform other therapies. . . .

The Kenilworth, New Jersey, company lowered its 2016 financial forecasts slightly, citing higher costs for restructuring and write-downs in the value of some products with limited sales potential — also the result of shifting more marketing and research dollars to Keytruda and Zepatier. . . .


Now you know -- off for the weekend, with my youngest son -- down from the North. Smile.

Thursday, July 28, 2016

Excellent And Balanced Take On Brexit -- In U.K. BioSciences Arena


Given that the global giant we follow will announce Q2 2016 earnings tomorrow morning early, I thought I'd post a global-looking item I ran across Sunday night. I think this is one of the best short form blog spots I've yet read -- on what we might actually, soberly expect from Brexit, some time at least two years from now, should it all come to pass, along the lines people envisioned a month ago (that's our original one on it -- along the below lines, from June of 2016).

It is balanced, level headed and sets forth what a glacial process this will be -- along with the high probability of some significant melting (material modifications to the process), along the way. Do go read it all:

. . . .[I]t is worth noting that Switzerland and Norway are able to benefit from membership in the European Free Trade Association without being EU member states (Complicating matters, control over immigration was one of the rallying cries for the Brexit “Leave” vote, but the EU trade agreements with Norway and Switzerland come with requirements for free movement of people).

So, in broad economic terms the UK could come out ahead. The UK has a trade imbalance with the rest of the EU; it imports more from the EU than it exports, so it is less reliant on EU as a market than the EU is on the UK for its market. Accordingly it is likely that the UK will be able to negotiate trade agreements on favorable terms. . . .


[And in equal time land, for those of you who need the counter-view -- or a more alarmist take -- go read this from people selling consulting services, about Brexit doom scenarios. They have a vested interest in making it all quite scary of course.]

Onward -- soaring actually, after an earlier unhinged near treasonous melt-down by Mr. Trump at a press conference, and then, in perfect counter-point, a transcendent speech by our 44th President last night -- perhaps the best one he's ever given. He simply buried Mr. Trump's home-grown demagogue rhetoric -- in hope. The audacity of hope. That is the America I know and love.

Wednesday, July 27, 2016

Trivial Footnotes Alert -- But I Simply Cannot Resist This One...


I really can't stop laughing, about this -- his blind spot is the size of. . . Pakistan. That's big.

Mr. Hassan recently told an interviewer of the adversity he faced, growing up. [His ears must have been (virtually) burning, given that I haven't typed his name in quite a while here, prior to Sunday night -- in comments.]

This very morning, in a goofy non-story, in the capitalists' paper of record, the Wall Street Journal -- we read of Mr. Hassan's "difficult" first job -- in 1965.

Why am I noting it? Because by his own admission, he did this "back-breaking" farm job. . . wait for it: For. Three. Whole. Weeks.

It wasn't all through high school, or even all through his college years, or college summers -- no, it wasn't even a whole summer. It wasn't even a whole month -- in one summer -- in England.

This says so many things about him: but not I suspect, the things he hopes. He plainly thinks it is newsworthy that he worked a real job, for three weeks, over a half a century ago. This actually makes me feel better -- about simply reporting what he did, to some 35,000 legacy Schering-Plough career scientists and office workers (circa 2010). Here's the WSJ bit:

. . . .Mr. Hassan says his stint as a produce picker and cannery worker in the summer of 1965 “was a character builder.” He spent three weeks in rural Cambridgeshire, England, following his initial year of college studying chemical engineering in London.

Born and raised in Pakistan, that summer, Mr. Hassan harvested farm fields and canned fruit and green beans alongside students from other European countries. His free summer housing consisted of a small hut with six bunk beds.

Mr. Hassan says he cited that difficult experience years later while advising his son and two daughters about summer employment options during their college years. . . .


Some days, this stuff just writes itself -- kinda' like. . . I don't know, the current GOP Presidential nominee (arguably within an eyelash of treason) offering to aid and abet espionage -- by a foreign power (the KGB, no less) -- in order to influence, or sway -- a US election. Astonishing -- except that we have come to expect this level of shamelessness, from Mr. Trump. He will lose by double digits in November.

Gilead's Renewed West Coast Patent Spat JMOL Motion To Be Heard On August 4, 2016


Gilead essentially argues that Merck did not describe its claimed patents specifically enough in writing, so that a practitioner, ordinarily skilled in the art and science of bio-chemistry could make the invented compound, and see the claimed moiety. We should remember that Gilead has convinced the able Judge Labson Freeman in San Jose that Merck's claims aren't written with specificity precisely because (Gilead says) Merck simply copied these ideas from Pharmasset, during a later abandoned M&A due diligence process.

So, according to Gilead, Merck had stong incentive to avoid such a precise description, for fear that it would then be plain that the claimed invention was just cribbed from Pharmasset's prior work. Here is Gilead's motion for Judgment as a Matter of Law, as a 13 page PDF file.

. . . .CLERK'S NOTICE RESETTING TIME OF MOTION HEARINGS. [432] MOTION for Judgment as a Matter of Law (Renewed) under Fed. R. Civ. P. 50(b), [434] MOTION for Attorney Fees pursuant to 35 U.S.C. Section 285. Motion Hearing set for 8/4/2016 01:30 PM before Hon. Beth Labson Freeman. . . .


Now you know. Onward, grinning ear to ear, about this evening. . . .

After Some Apparently Waifish Sales, Merck Hands Back Suite Of Sublingual Allergy Tabs -- To ALK-Abelló


This entire relationship has been definitively immaterial to Kenilworth. After spending perhaps $120 million, by the time the relationships and clincial trials are transitioned, some six months from now, I expect that Merck has actually generated sales revenue of less than than half of that amount, life-time to date, on the franchises.

Back in April of 2014, here was our take on this licensed product suite: "This melt-in-your-mouth pill -- called Grazax® in Europe, and Grastek® here and in Canada (where it won approval in March of 2012) -- is finally going to be available in the US with a prescription, beginning around Mothers' Day 2014. It enters a crowded field, likely to be dominated by Stallergenes -- a French pharma concern. . . ."

[That seems to be almost exactly what transpired -- with a renewed tip of the hat, to our well-informed EU commenter -- who predicted it all.]

Here is some additional December 2013 background, on the relationship first struck in 2007 (prior to our beginning this blog coverage). And this morning -- FiercePharma on it all -- do go read:

. . . .Hørsholm, Denmark-based ALK expects to regain the rights to the immunotherapies--which address grass, ragweed and house dust mite allergies--early next year. Between now and then, Merck and ALK will work together on a six-month transition period. ALK has said it will use its resources in North America and its base in Denmark to smooth the transition, but with sales and marketing, registration activities and clinical development all in mid flow, there is potential for a bumpy ride. . . .

Merck has paid out more than DKK 700 million ($100 million) to ALK as part of the deal it struck in 2007 for the rights to the drugs, but its returns to date have been small. . . .


At one point, I had guessed $300 million in peak annual sales, figuring that Merck's "hurdle rate" -- for being interested in the deal, would need to be at least that high -- to be worth the trouble of running the clinical trials. I now suspect that it never got close to $50 million a year.

To be clear, I think for smaller pharma concerns, that sales revenue likely still presents an attractive potential return (especially now that the clinicals are paid for), so I expect ALK-Abelló will find a new North American partner -- albeit a smaller one. But the news caused an 18 per cent drop in ALK-Abelló's stock price overnight. Onward on a glorious morning -- baby-sitting a flawless new life, tonight! Woot!

Tuesday, July 26, 2016

Merck Vs. Merck Update: August 1, 2016 Conference Likely Scratched -- Now In Mid-September 2016


While the able judge has not yet "so ordered" -- and while there was to be a court hearing on August 1, 2016 in Newark's federal District courthouse, on this spat over the two global titans' asserted Lanham Act claims and counterclaims -- it is highly likely that this hearing will be pushed back, into mid-September now.

Here's the operative part of the joint letter -- from both companies' counsel, overnight:

. . . .We, along with Debevoise & Plimpton LLP, represent Defendant, Merck KGaA, in the above matter, and write jointly with McCarter & English, LLP and Hogan Lovells, LLP, counsel for Plaintiffs, Merck & Co., Inc. and Merck Sharp & Dohme Corp., to request that the Rule 16 Conference currently scheduled for August 1, 2016 be adjourned to either September 14, 15, 16, 19 or 20, 2016. We make this request because of vacation and trial schedules of counsel involved in this case. If this is acceptable to the Court, we request that Your Honor "so order" this letter with the new date and time for the Rule 16 Conference and enter it on the docket. . . .


I might be so bold as to suggest that it may also allow for more time to work out an agreed settlement here, as well. That would be smarter for both. So. . . g'night all of good will -- the Democrats (but particularly the FLOTUS 44) have been on fire, of late. And I for one am proud -- of all of them. . . . They are the answer to Mr. Trump's never ending stream of divisive invective -- and small-minded hatred.

Update On The Delaware USDC Oral Arguments Today -- Gilead Hep C Patent Spats Edition


Matching the order at the end of the day, today -- to the agenda that preceded it by a few days -- I might reliably offer at least a few fairly-solid conclusions, even just from this cold electronic record. Smile.

There was a long day of argument, and in the end, Judge Stark has reserved on the question of whether Gilead should prevail on summary judgment, at least as to the idea that Merck/Idenix had not provided a sufficiently precise written description in the patents in question -- to avoid being invalid for vagueness (i.e., the written description invalidity contention mentioned below). SO now the new trial date (should the parties fail to settle prior to that time) is December 5, 2016. Here's the full oral minue order, from the bench, transcribed electronically into PACER, an hour or so ago:

. . . .ORAL ORDER: For the reasons stated by the Court at today's hearing, IT IS HEREBY ORDERED that:

(i) Plaintiffs' Motion to Strike (C.A. No. 13-1987 D.I. 295) is DENIED;

(ii) Plaintiffs' Motion to Strike (D.I. 326) is GRANTED;

(iii) Defendants' Motion for Summary Judgment (D.I. 298) is DENIED WITHOUT PREJUDICE with regard to Defendants' written description invalidity contention and DENIED with regard to the motion's remaining grounds;

(iv) Plaintiffs' Motion to Preclude (D.I. 305) is DENIED;

(v) Defendants' Motion to Preclude (D.I. 308) is DENIED;

(vi) the Scheduling Order (D.I. 42) is AMENDED to remove the October 11 trial date and a jury trial will proceed on December 5, 2016, with a pretrial conference on Wednesday, November 23 beginning at 9:00 a.m.; and

(vii) the Parties SHALL submit a joint status report no later than July 29 containing (a) a proposed briefing schedule for supplemental construction of the relevant '054 and '597 patent claim terms, (b) a proposed briefing schedule for a renewed motion for summary judgment for lack of written description, and (c) proposed amendments to the Scheduling Order (D.I. 42) to account for the December trial date and reopening of fact and/or expert discovery related to the denial of Plaintiffs' Motion to Strike (D.I. 295). ORDERED by Judge Leonard P. Stark on 7/26/16. . . .


Now you know. A big day, for both sides -- and a delayed trial date, while the parties engage in the remaining discovery (from one another) -- that each had sought to avoid, by filing these motions. Onward, with a smile. . .

Slightly Refining My June 1, 2016 Predictions -- On Potential Supreme Court Drug-Makers' First Amendment Case(s) -- Thanks To My Commenter(s)


[Do go read the comments over the weekend, if you need the full back story, here.] My commentary, in reply:

I agree Anon. -- and no worries -- about tangents, here.

This entire website is one seven and a half year tangent, originally decrying some abuses of FDA (and SEC) rules, by one Fred Hassan -- the ex-CEO of legacy Schering-Plough. Smile.

As to Merck's GC (as noted on June 1) -- I've long felt that a delicate balance need be struck, between drug makers' commercial speech rights (which under long standing US Supreme Court precedents may be limited as to "time, place and manner(s)"), and the generally broad language of our first amendment.

Certainly, safety and accuracy should come first -- i.e., be paramount -- when a merchant speaks about "inherently dangerous" drugs and biologics (to use some 19th Century Cardozo court language) -- if mis-used.

I will go out on a limb and predict that when our 45th President [a Democrat who orchestrated proposals (in 1992) for the series of reforms that ultimately became the ACA of 2010] is sworn in come January 2017 -- and then she, in fairly short order, fills at least two Supreme Court seats -- we will see the High Court's support for "renewed vigor" in enforcing the FDA's rules limiting manufacturers' off-label touting, and other promotional notions.

I now think FDA may see expanded, as opposed to contracted authority, here. And thanks to you, I'll make a new post of it, in a moment.

Do stop back by -- thanks for the thoughts -- travel well; but travel light.

And the comment that led most directly to these revised thoughts:

July 26, 2016 at 6:34 AM -- By: Anonymous.

. . .I feel it pertinent to note how this guidance letter potentially dovetails with what 'struck [you] as news-worthy' in your June 1, 2016 posting. In your referenced Bloomberg Law article, Merck's position on first amendment speech appears, at first glance, that pharmaceutical companies can say whatever they want about their products. However, taken at face value I do not feel that what Holston is implying should be afforded [as law], if recent history may serve as a guide.

In a 2005 article appearing in the New York Times, Dr. Sandra Kweder, acting director of the FDA's center for Drug Enforcement and Research, was quoted within the context of lessons learned from negotiating labeling with Merck for their blockbuster selective COX-1 inhibitor, Vioxx. In this article Kweder said that the power to change a label "would be very helpful."[1].

I hope what we are witnessing here is the FDA attempting to re-gain some 'teeth' in carrying out basic duties with which we as a public have continuously expected from this Public Health Service Division.

~~~~~~~~~~~~~~~~~~~~~~~~~~

[1] Harris Gardiner (2005) FDA Official Admits 'Lapses' on Vioxx. New York Times.


Monday, July 25, 2016

Not Any Real Surprise, From Seamus Fernandez -- As Both Merck And BMS To Report Q2 Results This Week...


If you've been reading our regular updates on the two competitors in the checkpoint inhibitor space, you will not be surprised to hear that Leerink Swann analyst Seamus Fernandez is lifting his full year 2016 estimate on BMS's Opdivo® sales. He sees that franchise as accelerating its growth.

Meanwhile, he does still expect growth from Merck's Keytruda® when it reports on this coming Friday morning, but he is reducing his full year estimate on the very pricey immuno oncology treatment due to trendlines in IMS scrip data he's recently reviewed. [I will say we made much the same call, over a year and a quarter ago, now -- and without the benefit of the expensive IMS weekly data subscription.] In any event -- here is what to look for, as this busy week for drug company and bioscience earnings wears on (per Investors' Business Daily):

. . . ."Together with Yervoy, Bristol-Myers maintains 85% share of the checkpoint inhibitor market," Fernandez wrote, referring to the class of cancer drugs to which Opdivo belongs. "Based on these trends, we have increased our full-year 2016 Opdivo sales by $450 million (to $3.8 billion) and expect strong uptake in Japan will improve royalty revenue from Ono. . . ."

Merck, reporting Friday morning, is in a similar situation, but its growth is expected to be more modest -- in single digits on the bottom line and flat on revenue. Its blockbuster diabetes franchise is facing increasing competition, even as Opdivo competitor Keytruda takes off.

"We have lowered our near-term estimates for Keytruda and the Januvia franchise based on sales and prescription data, respectively; however we see greater long-term opportunity for each relative to our previous forecasts," Fernandez wrote. "The recent announcement of an overall survival benefit for Keytruda from Keynote-024 trial raises the prospects for the drug in first-line non-small cell lung cancer (NSCLC). . . ."


Now you know. And now. . . it is just simply too wonderful, outdoors, to stay in any longer -- off for a summer afternoon walkabout. Smile!

Important Hearing Tomorrow Morning, In Delaware US District Court -- For Gilead And Merck: Patent Spats


I am in a bit of a hurry now -- on a train -- but tomorrow's hearing in Delaware, before the very able Judge Stark portends to set the tone for the rest of the East Coast chapter of the patent fights over Gilead's Hep C mega blockbusters Harvoni® and Solvaldi®.

I expect that the embarrassing loss of a $200 million jury damage award, in California's Northern District, will ultimately mean that Merck must settle here -- but we shall see. Back with more when I have some free time, this afternoon:

It is hard to imagine that some of the California results will not have already spilled over, into the discovery spats now underway, in Delaware. Moreover, it seems that there is a reasonably high probability that Gilead's motion for summary judgement might be granted, at Item (3) below (after a few weeks reflection, and time to prepare a well-supported opinion, in Judge Stark's chambers) -- based on what was learned in California. We shall, as ever, see:

. . . .ORAL ORDER:

IT IS HEREBY ORDERED that with respect to the hearing tomorrow, July 26:

(i) the parties shall be prepared to address, all pending motions, as well as the issues raised in the recent status letters to the Court;

(ii) the order in which matters will be argued is as follows:

(1) Idenix motion to strike reports of Dr. Secrist;

(2) Idenix motion to strike good faith defense;

(3) Gilead motion for summary judgment;

(4) Idenix motion to preclude;

(5) Gilead motion to preclude;

(6) status of attorney-client privilege issues; and

(7) trial scheduling; and

(iii) each side will be allocated up to ninety (90) minutes for its argument.

ORDERED by Judge Leonard P. Stark on 7/25/16. . . .


Now you know -- with more analysis, as time permits. Big grins!

FDA Breakthrough Designation; EMA "PRIME" Designation -- For Merck/NewLink V920 Ebola Vaccine Candidate


We must remark once again just how hard it is -- to overstate the importance of this vaccine candidate -- in arresting the last Ebola epidemic, in Africa. The so-called V920 rVSV∆G-ZEBOV-GP vaccine has thus far proven 100 per cent effective, when deployed in a ring fashion, against the virus in people who've come in close contact with an active Ebola carrier.

So it makes sense that both the European Medicines Agency, and the US FDA would put the candidate on a fast track to approval. And that's just what both have done, as of this morning. While Kenilworth certainly deserves generous plaudits for its work in both finishing the R&D, and actually mass-producing the vaccine -- and getting it intact and active, into the very difficult geographic environment Africa presents -- we should not forget the ten years plus worth of solid work of Canadian Public Health Agency scientists, and the NewLink Genetics team. Here's a bit from the story, out of Ames, Iowa this morning -- do go read it all:

. . . .Merck, known as MSD outside the United States and Canada, [along with Ames, Iowa-based NewLinks Genetics] has reached two key regulatory milestones for the Ebola Zaire vaccine candidate known as V920 (rVSV∆G-ZEBOV-GP). The U.S Food and Drug Administration (FDA) has granted the vaccine candidate Breakthrough Therapy Designation, and the European Medicines Agency (EMA) has provided the vaccine candidate PRIME (PRIority MEdicines) status.

V920 was initially engineered by scientists from the Public Health Agency of Canada and subsequently licensed to NewLink Genetics. In late 2014, when the peak of the Ebola outbreak in western Africa was at its worst, NewLink Genetics licensed V920 to Merck, with the goal of accelerating the development, regulatory approval, and availability of this candidate vaccine. Merck is responsible for the research, development, manufacturing, and regulatory efforts in support of V920. Since that time, Merck continues to work closely with NewLink Genetics and their external collaborators to accelerate development and licensure.

"These regulatory designations reflect great credit upon the extraordinary public-private partnerships which have allowed the vaccine candidate to be included in 12 Phase 1, 2 and 3 studies on three continents in less than two years," said Thomas P. Monath, M.D., Chief Scientific Officer and Chief Operating Officer of the Infectious Disease Division of NewLink Genetics. Charles L. Link, Jr., M.D., Chairman, Chief Executive Officer and Chief Scientific Officer of NewLink Genetics emphasized that, "While the Ebola Public Health Emergency of International Concern (PHEIC) is over, we know the threat of re-emergence remains. We are encouraged by these FDA and EMA decisions which we hope will aid progress of the candidate vaccine towards potential licensure. . . ."


And bit by bit, the world's bio-science community is putting the WHO in a position to much more quickly arrest future outbreaks. Sadly, it is an inescapable fact of biology that the virus will eventually reappear -- but it need not become an epidemic, the next time around. Smiling widely -- on a clear mid-summer Monday morning, now -- brimming with optimism on my walk in, here. Be excellent to one another.

Saturday, July 23, 2016

O/T: 54 Years Ago This Afternoon, President Kennedy Used Telstar 1 -- To Broadcast A Live TV Address, From The US To The UK


In so doing, he (and Walter Cronkite, later broadcasting the nightly news -- and rather improbably, the Chicago Cubs, immediately prior thereto -- whose game at Wrigley, with the Philadelphia Phillies was broadcast to England for a few moments, while President Kennedy waited to begin his prepared remarks) paved the way for the global lightning-fast internet we now take for granted. If you are looking at these YouTube video-feeds in Wolverhampton, Tokyo or Dakar -- you may well be seeing the below, bounced off a satellite -- one of hundreds of far-advanced great great grandchildren of Telstars 1 and 2.

Here more than a half century on, those early, ginger steps led to this day: letting us stay in touch with one another live, and instantly, from Japan to Antarctica, from to Kenya to Canada, and from the US to Turkey. Simply amazing, for those of us who still remember a time when it was not so:

. . . .Telstar 1 was an experimental active communication satellite built by Bell Systems. It was launched with assistance from NASA in July 1962. Approximately 400 transmission sessions were conducted by the satellite with multi-channel telephone, telegraph, facsimile, and television signals in the six month period after Telstar was launched. Hundreds of technical tests and measurements were also made which would help later satellites revolutionize the communications industry. [In the Cubs middle innings, batter Tony Taylor, was seen hitting a ball pitched by Cal Koonce to the right fielder George Altman. Then the video feed cut away to President Kennedy, speaking live in Washington, DC.]

A few months later, during November 1962 the command subsystem on the satellite failed. A brief restoration of services was made in early 1963, however within six weeks the command subsystem again failed. The cause of the failures was due to degradation of transistors, caused by Van Allen belt radiation increases later attributed to very high level troposphere American & Soviet nuclear weapons tests then being conducted. . . .


It is hard to overstate what a "wow factor" that moment in television history held. Kids across the nation watched, glued to their (overwhelmingly) black and white TV sets, as their parents explained satellite orbits. It even inspired/generated an eponymous No. 1 pop-hit, by the Tornados -- in both the UK and the USA. Here's a bit of that live presidential address, at about 24 minutes and 53 seconds in.



Now you know -- off (fittingly, now) to see Star Trek Beyond. . . smile. . . .

Pfizer's Lobby Spend Nearly Doubled Merck's -- In First Half Of 2016: $7.77 Million...


Just as we intoned a few days ago, there is still "embedded" in the huge 2016 first half spend by Pfizer, all that money it had to write off, lobbying to skirt the two-year old Treasury regulations -- on inversions, during Q1 2016 -- when it had to abandon its $159 billion Allergan re-domicile deal. [That the deal was always going to end up DOA was obvious to most savvy financial people -- at least to those not trapped in the Pfizer echo-chamber.] What an ignomious waste of shareholders' money, that was. It was clear over a 18 months ago, that the regulatory landscape had changed -- after Mr. Read's first failed inversion (at $120 billion, for AZ) went down in flames. Between the two failed deals, Mr. Read likely spent over $600 million -- when one includes all the broken deal fees to bankers and counter-parties, and legal, lobbying, tax and accounting expenses.

Okay -- to the specifics, then: Pfizer spent $3.57 million in Q2 2016 (compared to $2.45 million in Q2 2015). And that in turn, compares to its $4.2 million in Q1 2016. Down only 12 per cent, compared to Merck's cutting lobby-spend in half, in the same time frames.

In any event, I would hope that Mr. Read's lobby spend decreases more significantly in Q3 2016 -- to become more closely proportional to Pfizer's size relative to Merck's -- as it is clearly a tumor, at this point in the year. With very little happening in the way of actual legislation, until the new President is elected, the whole operation ought to be essentially moth-balled, until January 2017. But that's just my $0.02 -- for Pfizer's institutional investors, to communicate/advocate with Mr. Read. Here's some of what he spent on, in Q2 2016 -- I've bolded the bits that Merck likely also spent on (albeit much smaller sums):

. . . .Trans Pacific Partnership Negotiations, Miscellaneous Tariff Bill (MTB), Trans-Atlantic Trade & Investment Partnership (TTIP,) Canada IP/Trade Issues, South Africa IP Issues, China IP, Saudia Arabia Pricing Issues, United Nations Health Panel [likely along with Merck], Thermacare EU, Privacy Shield, G7/G20, APEC, OECD. . . .

21st Century Cures Initiative, Senate Innovation Project, Drug Pricing, Biosimilars Reimbursement Policy. . . .

Patent Troll Legislation, Defend Trade Secrets Act, Medicare Rebates/Medicare Part D, Non-Interference, Medicare Part B Reimbursement, Medicare Part B CMMI Demo. . . .

Deferral, Comprehensive Tax Reform, Territorial Systems, Patent Innovation Box, Cadillac Tax, Inversions, Section 385 Proposed Regulations. . . .

Omnibus Appropriations Bill, LHHA Appropriations, 2017 FDA & Labor/HHS Appropriation Bills. . . .


Now you know -- off to mountain-bike, a workout, and then a longish swim in the cool clear lake waters, then lie on the white sandy beaches, here. . . smile. I love summer Saturdays. . .

Friday, July 22, 2016

Merck Encounters FDA Delay On Its C. Diff. BLA -- But Stool Capsules Are Already Likely Eating Into Would-Be Market Share...


While this offering will, in part, serve as a complement to the Cubist acquisition offerings, it will certainly sell on its own -- if and when it garners approval. However, the reality may be that the biologic will be overpriced compared to the purified stool capsules (or alternatively, implants) which have gained increasing favor, as payers look for more economical methods for tackling this otherwise rather common and widely-dispersed infection problem. We shall have to wait and see how it all unfolds, but I expect that Merck has trimmed its peak annual sales expectations for the candidate, given intervening developments on other C. diff. fronts.

Chief among these is the notion that, as I had originally noted -- as early as December 2012 -- Clostridium difficile biologics franchises may face the reality that purified stool implants (or more recently, carefully insulated oral capsules!) solve the same problem, at a fraction of the biologics' costs. And some of that filtered through at the earlier FDA Advisory Committee meeting -- but here is FierceBiotech on it all, as of this morning:

. . . .Trials for the drug, which is not a traditional antibiotic but designed as a mAb to prevent the recurrence of C. difficile infection by binding to and neutralizing the C. difficile toxin B, have already been chided by an FDA expert panel.

Last month the regulator’s advisory group questioned the Big Pharma giant for its small trial size despite the patient population being huge, with others seeing shortcomings in the data. The panel did vote 10-5 (with one abstention) for a recommendation, but most seemed to harbor differing levels of reservation. . . .


So now the earlierst this BLA will be cleared will be late October, 2016. Now you know -- and onward, to a perfect -- if smokin' hot, summer weekend -- all grins here! I refuse to allow the re-emergence of the name of David Duke -- into national political race dialogues, bend the arc of my joy -- at all. Next Star Trek movie installment in the offing, as well!

Thursday, July 21, 2016

Merck Drastically Cuts Its Lobbyist Spend In Q2 2016


While final figures for Pfizer are not yet available (as it is almost always tardy in reporting), it looks like Pfizer cut its Q2 2016 lobby spend by only about 12 per cent, compared to Q1 2016.

Merck on the other hand, has cut its Q2 spending in half, compared to Q2 2015 -- and spent only about a third of what it spent just last quarter, in Q1 2016. My suspicion would be that this US presidential election year summer brings us to both a congressional recess, and not much in the way of action on major legislative proposals, for or against pharma's interests -- as presidential campaigning now dominates the scene. Even so, here is what Kenilworth says it spent its lobby-dollars on, in Q2 2016:

. . .340B (no specific bill), Hepatitis C (general education; no specific bill), Human papilloma virus and vaccine policies (general education), shingles vaccine policies (general education), antimicrobial resistance (general education and DISARM (H.R. 4187), biosimilars (no specific bill), 21st Century Cures (H.R.6), Senate Innovation Project (no bill number), cost and value of medicines (no specific bill), Strengthening Public Health Emergncy Response Act (H.R. 3299), priority review voucher and medical countermeasures (general education), women's health (general education), insurance benefit design and value-based contracting (general education), general pharmaceutical issues. . . .

Comprehensive tax reform (no specific bill), international tax proposals (no specific bill), orphan drug legislation (S.1128), base erosion (no specific bill), territorial tax system (no specific bill). . . .

Medicare Part D (general education, no specific bill), changes to low-income subsidy structure in Medicare Part D (general education, no specific bill), H.R. 5122 (Centers for Medicare and Medicaid Innovation demo), Independent Payment Advisory Board (general education, no specific bill), Medicare Part B (general education, no specific bill); Medicaid (no specific bill). . . .

Trans-Pacific Partnership, data exclusivity for biologics, United Nations high level panel. . . .

FY17 Labor HHS Appropriations bills, FY17 Agriculture Appropriations bills, vial size. . . .


The United Nations high level panel above was likely on Ebola and vaccine policies. Now you know. And I think Pfizer's figures stayed relatively high in Q2 2016, in large part because it was still working to get clearance for the Allergan inversion deal into early Q2 -- which it has now abandoned. I'd expect sharper declines from Pfizer, in Q3 2016 -- proportionately more in line with Merck's. But time will tell. I am planning on wholly-avoiding Mr. Trump's speech tonight -- as I don't want to upset my stomach. But we will see. . . . smile.

It Is Looking More Likely That Judge Labson-Freeman Will Decide Whether Merck Pays $15 Million Of Gilead's Legal Fees, Even Before The Appeals Are Decided...


Overnight, the very able federal Disrtict Court Judge Beth Labson-Freeman ordered Gilead, by July 27, 2016 -- one week before the hearing on August 4, and one week from now -- to provide her with a complete set of so-called "task-based" deeply detailed by time-keeper spreadsheets. These sorts of breakdowns show the number of hours expended by each billing attorney, and on which tasks those hours were expended. She has not required a breakdown of the billing rates for these attorneys (yet). What the Judge is after is a sense of whether the lodestar amount Gilead is seeking from Merck is reasonable.

In addition she has ordered that Merck be allowed to see the aggregated, and individualized breakdowns of hours by task, by lawyer -- with client confidences redacted, of course -- so that Merck may assess whether the fees sought are reasonable, under the circumstances.

Here is that two page order, for the record -- as a PDF file.

For its part, Merck had just asked that the fees motion not be heard until the appeals are completed. It would seem that Judge Labson Freeman is not inclined to wait -- as she'd likely rather collect this data while it is right at hand, and everyone's memories of the to and fro' of the trial -- and trial prep efforts -- are fresh.

The August 4, 2016 9 AM PDT in-court appearances, and argument, portend to be rather dramatic, in my experienced estimation. Over $15 million in fees reimbursement hangs in the balance for Merck. We will keep you informed. Were I a betting man, I'd guess that over $13 million will be ordered paid by the judge, in the end. [Again, as she quite sagely did, with the overall original $200 million verdict -- she is clearly hinting here that the two ought to get together and settle on a number -- from Merck to Gilead -- and that she'd likely be disposed to bless it. But if they couldn't get there on the verdict (now vacated in its entirety), it is not clear they'll be able to negotiate their way to get to agreement, on the fees, either. She does seem to be hinting that she will award some part of these fees, in seeking this level of detail, right now. Just my $0.02 -- to Mr. Frazier.]

Okay -- out now, on foot -- to find a tart, freshly cool summer fruits salad, on a muggy, heat-domed Thursday early afternoon. . . but outdoor-dining, and with live music, to boot -- will be in order, for certain. . . .

O/T: The GOP's "Party-Unity" Night Went Well -- WWF Theatrics Edition(?)...


Well -- these goofy Trumpers have turned the Republican National Convention into a WWF show, overnight. Hilarious. Trump walks in to cut off Mr. Cruz's speech? The TV monitors cut out from time to time, and the would-be Emperor Trump scowls in anger? [But first, let me plug and support the sublime artist from whom the image at right was derived: do go get your very own Cruz WWF 2020 poster here!]

It was hard to keep up with all the mayhem last night, as it was unfolding essentially simultaneously (i) on the floor, and (ii) on the podium, and (iii) in Mr. Trump's family box. Pegged hard right on the irony meter, but likely missed by many last night were Mr. Christie's remarks -- to TV reporters, from his seat on the convention floor, calling Mr. Cruz "shameful," and "not a man of integrity." Gee -- is this the part of Night Three, when the party finally unifies? Cool.

Ted Cruz (whose wife needed a security escort to leave the arena, after his speech) echoed the #NeverTrump movement's "vote your conscience" mantra -- and pointedly REFUSED to endorse the currently proposed ticket.

Some hard-right pundit said he thought the night was boring, but good for party unity -- and Mr. Trump. I am not sure what sort of perception-altering meds that guy is on, but do steer clear. Is/was he on Ketamine?

Me? I don't really think GOP conventioneers threatening a sitting US Senator's wife qualifies as "good for the party, and Trump". But what might I know? Overall, it couldn't happen to a nicer bunch of folks, truly.

Onward -- into the abyss, which is a Trump-Pence landslide loss -- with Mr. Cruz starting his obviously self-aggrandizing 2020 GOP Presidential nomination run. . . as of last night.

If there is still a GOP by 2020 -- in name or otherwise, that is.

The Trump team is handing this 2016 election over to Mrs. Clinton, on a silver platter. 80 per cent probability via Nate Silver; 76 per cent probability via the New York Times models. And all of that was BEFORE last night's chair throwing WWF cage match. They threatened a spouse of a US Senator, from their own party? That's beyond the pale -- truly. Not that Mr. Cruz was an innocent -- but they sure look like brownshirts to me.

I am just all grins -- on this second sweltering morning. . . all grins.

Wednesday, July 20, 2016

Not "Our" Merck -- And Not So Sure About This Idea, More Generally...


Let me say at the outset (per the very impressive line-up of logos, at right) that a lot of extremely smart people have decided to back this with real cash -- nearly $50 million, if we include the seed-, and Series A- rounds.

Having said that, I for one am glad that the US Merck (no relation) has kept its venture arm out of this investment. [It would have been a short reach, from Amgen to Dr. Perlmutter (and thoughts of eventual expansion to Alzheimer's), but that didn't happen -- thankfully, in my opinion.] I'm not at all sure I see a fit, even between the German Merck venture arm, and this idea. Now, Pfizer and Amgen -- each is already in the AD/HD space, with drug offerings, so I at least see the theory there.

It would be wonderful -- a miraculous development, actually -- if it turns out that a mobile video game platform can improve the cognitive abilities of kids with AD/HD. I suspect (having done almost no reading on the topic) it is more likely to be used first as a diagnostic device -- to assess kids.

Even so, if the longer term goal is an efficacy trial, for improvement in AD/HD symptoms -- I think that will be very tough to demonstrate. But we shall see -- here's a bit, from XconomyBoston, this early morning:

. . . .Akili announced it tacked on $11.9 million to its recent Series B funding round, bringing the round’s total to $42.4 million. The additional money comes from the venture capital arms of pharma giants [GERMAN] Merck and Amgen—both new investors in Akili—along with previous backers, Akili says in a press release. Before the Series B, Akili had raised at least $7 million through venture capital, grants, and industry collaborations.

The deal strengthens Akili’s ties to the pharma industry and likely gives its experimental technology more credibility as it tries to become the first company to receive FDA approval to sell interactive electronic games as a medical device capable of diagnosing and treating a variety of cognitive disorders. Akili now has four relationships with large pharma companies or their investment arms; it previously struck a partnership with Pfizer and snagged an investment from Shire Pharmaceuticals.

Akili marks the first investment by [GERMAN] Merck’s VC arm into a company that sits at the intersection of software and medicine. . . .


Onward now, on a sweltering, humid mid-summer morning -- with a wide grin, just the same. . . as more symphony music is in store, in the cool of this coming evening. Be excellent to one another!

Tuesday, July 19, 2016

Sovaldi®/Harvoni® Merck v. Gilead Patent Battles Update: Next Post Trial Motion Hearing Date: August 4, 2016


Gilead's motion to recover around $15 million in its attorneys' fees, from Merck -- as well as other renewed post-trial motions -- will now be heard in Northern California (San Jose) federal District Court -- on August 4, 2016 at 9:00 AM PDT.

We will let you know when we hear/see anything, via the electronic PACER filings. Here is a link to the backgrounder on Gilead's earlier motion for the attorneys' fees. Fees it says it should not have had to incur, had Merck not engaged in "inequitable conduct" pre-trial -- and during it.

. . . .CLERK'S NOTICE RESETTING MOTION HEARINGS

As to [432] MOTION for Judgment as a Matter of Law (Renewed) under Fed. R. Civ. P. 50(b), [434] MOTION for Attorney Fees pursuant to 35 U.S.C. Section 285.

Motion Hearing set for 8/4/2016 09:00 AM before Hon. Beth Labson Freeman. . . .


And, as we head out, shortly -- on a flawless summer evening, to hear the symphony, we are keenly aware of just how fortunate we are -- stem to stern. Smile.

O/T: Who "Said It Better" -- Wore It Better -- And LIVED It, Better?


It may well be that Mrs. Trump didn't initially tell the truth when she said she wrote most of it herself, but it is wickedly ironic, just the same.

The words she, or her ghost-writer, clearly stole center on her family values -- and the value of keeping one's word. I prefer the ORIGINAL -- genuine article, not the pale imitation, per the NYT:

. . . .Mrs. Obama, in her 2008 speech:

"Barack and I were raised with so many of the same values: that you work hard for what you want in life; that your word is your bond and you do what you say you’re going to do; that you treat people with dignity and respect, even if you don’t know them, and even if you don’t agree with them. And Barack and I set out to build lives guided by these values, and pass them on to the next generation. Because we want our children — and all children in this nation — to know that the only limit to the height of your achievements is the reach of your dreams and your willingness to work for them. . . ."


Just. Go. Compare. Stolen, I tell you.

I am tempted to say that I didn't prefer it* in the plagiarized German/Slovenian version -- but that would be small-minded. So instead, I'll just note that the Trump candidacy is a train-wreck unfolding in slow motion. He will lose in a landslide, now. Bank on it. Out on a flawless Tuesday morning -- enjoying the fresh air!

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* That is a perhaps too-oblique reference to an immortal Art Buchwald bon mot, about a Pat Buchanan speech in the early 1980s, when he said "Actually, I preferred it in the original German. . . ." Now you know.