East Coast Biotech Roundup: Vertex, Dimension, Merrimack, & More
[Updated, 9:22 am ET] The city of Boston was in baseball euphoria this week as the Red Sox claimed their third championship in nine years—a sentence many New Englanders likely thought they’d never read in their lifetime (as much as it pains this Yankee fan to say, congrats to you Sawx fans out there). That being said, all the news in Beantown wasn’t confined to Yawkey Way. All the week’s East Coast biotech headlines below:
—Cambridge, MA-based Vertex Pharmaceuticals’ (NASDAQ: VRTX) hepatitis C drug telaprevir (Incivek) had a meteoric rise to stardom, but its fall has been just as fast. Declining sales and emerging competition have caused Vertex to cut 370 jobs, or about 15 percent of its workforce. About 175 of those jobs are in Massachusetts. Vertex expects the cuts will save it about $150 million to $200 million in operating expenses next year as it puts more of its attention on its burgeoning cystic fibrosis program. Vertex’s CF drug, ivacaftor (Kalydeco), tallied $101 million in sales in the third quarter.
—Gene therapy continued its rebirth in the eyes of investors this week as Cambridge-based Dimension Therapeutics became the latest startup in the space to get significant venture backing. Fidelity Biosciences provided Dimension with an undisclosed Series A round to help start it up and pursue a plan to treat hemophilia and certain rare diseases with gene therapy. Dimension is doing so with a broad license to a gene delivery platform from Washington, D.C.-based Regenx.
—Shares of Cambridge-based Merrimack Pharmaceuticals (NASDAQ: MACK) fell more than 15 percent after it revealed that its antibody cancer drug, MM-121, missed its mark in its latest mid-stage study. Merrimack said patients taking its drug in combination with chemo agent paclitaxel fared no better than those taking paclitaxel alone. The study is one of a series of mid-stage trials Merrimack is running to find out not just if MM-121 works, but if it can accurately predict who should take it—and who shouldn’t. In this sense, Merrimack has said that it doesn’t expect all of its studies to hit their goals, and is hoping to find subgroups of people that respond the best so it can design a cheap, efficient late-stage trial. Still, MM-121 has now failed two separate mid-stage studies.
—Biotech entrepreneur and Dartmouth College professor Tillman Gerngross may be running Lebanon, NH-based antibody drug discovery shop Adimab, but now he’s also become chairman of a new San Francisco-based startup called Alector. Gerngross’ involvement is key for Alector: Adimab is helping the startup discover antibodies that it hopes to use to hit genetic-based targets for Alzheimer’s disease.
—Another domino fell in the evolving saga of Cambridge-based Ariad Pharmaceuticals (NASDAQ: ARIA) this week, as the company officially pulled its troubled cancer drug, ponatinib (Iclusig) off the market. It’s another big setback—albeit an expected one—for Ariad, which has now lost more than 80 percent of its market value in just a couple weeks, since halted a trial of ponatinib because of safety concerns.
—[Updated with new item] New York-based healthcare investment firm OrbiMed Advisors has raised just over $735 million to support its latest venture fund, OrbiMed Private Investments V LP. OrbiMed will use the fund to invest in about 30 biotech, med tech, and diagnostics companies in North America and Europe. Each investment will range between $10 million and $50 million apiece. OrbiMed recently backed new biotech startups Alector (above), Loxo Onocology, and Seragon Pharmaceuticals.
—An experimental rheumatoid arthritis drug that New York-based Bristol-Myers Squibb (NYSE: BMY) licensed from Bothell, WA-based Alder Pharmaceuticals met its goal in a mid-stage study this week. Bristol grabbed rights to the drug, known as clazakizumab, for non-cancer uses in 2009 for $85 million up front and potentially $1 billion in milestones. Bristol hopes that the drug can eventually compete with rheumatoid arthritis blockbusters adalimumab (Humira) and etancercept (Enbrel).
—Just five months after graduating from the New York Digital Health Accelerator’s first class, Seattle-based startup Avado found a buyer. The company, which developed a cloud-based platform that helps doctors and patients communicate and manage health information, was sold to WebMD (NYSE: WBMD) for an undisclosed sum. Avado was one of eight graduates of the health accelerator, and the second one to sell itself so far.
—Bedminster, NJ-based Aerie Pharmaceuticals (NASDAQ: AERI) got a lukewarm reception from Wall Street, cutting its IPO price to $10 per share before raising $67.2 million from public investors. Shares of the glaucoma drug developer have stayed fairly stagnant since debuting on the Nasdaq. They closed at $10.50 on Thursday.
—Mexican billionaire Carlos Slim gave a $65 million gift to The Broad Institute of MIT and Harvard in 2010, and his Carlos Slim Foundation followed that up this week by adding $74 million to advance research in genomic medicine. The two will work to create diagnostic tools for breast cancer and diabetes.