Is sentiment coming together to push for FDA regulatory reform? Luke’s BioBeat column described industry efforts to shake up the FDA, and U.S. Rep. Darell Issa convened a hearing in San Diego last to collect life sciences testimony on needed reforms. We have details on all that and more.

—In a run-up to an FDA public advisory meeting today in Silver Springs, MD, Luke reported that an FDA staff analysis of data submitted for a new hepatitis C drug under development at Cambridge, MA-based Vertex shows a cure rate as high as 79 percent among patients getting their first-round of treatment. That’s better than the 75 percent cure rate reported by Vertex, which has substantial operations in San Diego. The question lingering today is whether two side effects cited by the FDA—rash and anemia—will affect the advisory panel’s recommendation concerning the Vertex drug, telaprevir.

—Dow Jones VentureSource provided more details about first-quarter venture capital activity in San Diego, including data about local life sciences deals. In contrast to the MoneyTree Report, which shows a sharp decline, Dow Jones says venture funding in San Diego was relatively flat, with $213.9 million invested in 26 deals. That includes $119.6 million invested in 13 healthcare companies in San Diego, which is almost even with the $121.6 million that was invested in 12 healthcare companies during the same quarter of 2010.

—San Diego’s Polaris Group, which seemed to spring out of nowhere, is moving to begin a late-stage clinical trial of ADI-PEG 20 for treating the most common type of liver cancer. The drug, also known as pegylated arginine deiminase, is intended to deprive tumor cells of arginine, an essential amino acid they need to survive and grow.

—San Diego’s Fate Therapeutics, which is developing stem cell therapies, has increased the size of its current equity round to $36 million and arranged for $1 million in debt financing, according to a couple of recent regulatory filings. Fate said in February that chairman John Mendlein was stepping in to run the company following the departure of CEO Paul Grayson, who is leaving to … Next Page »

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WTF!

You can forgive medical device investors and CEOs if they’ve uttered that not-so-family-friendly acronym during the last year or so.

First, the Food and Drug Administration signals it will likely tighten restrictions on the popular 510(k) regulatory program, which allows device makers to quickly develop new products that are slightly better or different than previous generations. Then Uncle Sam slaps the industry with a 10-year, $20 billion tax to help pay for healthcare reform. Politicians on both the right and left predict Medicare will soon start paying less than it does today for certain medical devices.

Compare this with the relative love the feds have bestowed on the drug industry. On the eve of the State of the Union address, Obama Administration officials announced the creation of a $1 billion drug development center to speed the commercialization of therapies. This comes on top of the $1 billion in tax credits the federal stimulus program gave biotech startups last year.

So what has happened?

It was only a few years ago that the public demonized Big Pharma as greedy institutions that opposed the sale of generic drugs to protect their multi-billion dollar profits. Now the medical device industry seems to be bearing the brunt of rage from Washington DC.

There’s no one simple answer. But the shift in fortunes can be traced to a number of factors, including healthcare reform, the erosion of the business model underpinning Big Pharma, and political ineptitude from the medical device industry.

YOUR TURN—The FDA tends to regulate by crisis. For the medical device industry, that crisis was Sprint Fidelis, the ultra-thin wires that connect implantable cardioverter defibrillators to the heart.

In 2007, Fridley, MN-based Medtronic issued a worldwide recall of … Next Page »

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Is it Wednesday again already? Must be time for some life sciences news…

—Lexington, MA’s Concert Pharmaceuticals raised $37 million in one of this year’s biggest Series C rounds in New England biotech. The deal was led by an unnamed public equity investor and joined by Adage Capital Management, SR One, Mediphase Venture Partners, Westfield Capital Management, Three Arch Partners, TVM Capital, Skyline Ventures, Brookside Capital Partners Fund, Flagship Ventures, Greylock Partners, New Leaf Venture Partners, and QVT Fund.

—Centers for Medicare & Medicaid Services (CMS) decided to cover the cost of the AbioCor artificial heart and the surgery to implant it—reversing a 22-year-old policy against Medicare coverage for heart-replacement surgery. Shares of the device’s maker, Danvers, MA-based Abiomed (NASDAQ: ABMD) rose slightly in response.

—Flagship Ventures co-founder Noubar Afeyan, Harvard-Partners Center for Genetics and Genomics scientific director Raju Kucherlapati, and MIT Institute Professor and Nobel Laureate Phil Sharp led a lively discussion about the future of Boston-area life sciences at our latest Xconomy Forum. A good time was had by all—except maybe Kucherlapati’s stylist.

—InfraReDx of Burlington, MA, won FDA clearance for a catheter-based tool for analyzing the chemical makeup of plaques on the walls of coronary arteries. The FDA said the device was the first of its kind and could help doctors identify plaques that may be more likely to rupture and cause heart attacks.

—Critical Therapeutics of Lexington, MA, was bought in a stock-based transaction by Cornerstone BioPharma of Cary, NC, after promising investors late last year that it would seek a merger.

—Lexington, MA’s Epix Pharmaceuticals scored a $7.5 million milestone payment from partner GlaxoSmithKline for beginning Phase 2b clinical trials of an Alzheimer’s drug.

—Curis, of Cambridge, MA, started a Phase 2 trial of a new treatment for colorectal cancer, earning a $3 million milestone payment from collaborator Genentech in the process.

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Regular readers of Xconomy will have noticed that for a while now we’ve been doing (almost) regular roundups of the previous week’s news, focusing on financings, M&A, and other deals. But Boston being such a key hub for life sciences, we thought a separate, bio-centric roundup was in order. So welcome to Life Sciences Wednesday. No promises it will actually fall on Wednesday each week, but it will bring you all the recent news (not just deals news) on biotech, pharma, diagnostics, medical devices, and the like.

—Natick, MA-based Boston Scientific (NYSE: BSX) revealed in an SEC filing that the U.S. Department of Justice is conducting a civil investigation into whether the firm and other manufacturers promoted off-label uses of biliary stents.

—Regulatory filings, reported by Private Equity Hub, were also the source of the news that Boston-based Mascoma, which is developing genetically engineered bacteria to speed the conversion of cellulosic biomass such as wood chips into ethanol, closed a hefty $50 million Series C funding round. Mascoma itself remained mum, although Xconomy confirmed the story with a source close to the deal, which includes $30 million in equity and $20 million in debt and was evidently inked with General Catalyst Partners, Kleiner Perkins Caufield & Byers, Vantage Point Venture Partners, Atlas Venture, Pinnacle Ventures, Khosla Ventures, and Flagship Ventures.

—Harvard Medical School professor George Church’s Personal Genome Project got an unrestricted gift from Google late last year, according to a Bloomberg report. The grant (the value of which was not disclosed) will go toward the PGP’s $1 billion effort to 100,000 individuals’ genomes.

—Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ: ALNY) announced what it said was the first evidence that a drug based on RNA interference, or RNAi, is effective in humans. In a Phase II trial, the drug reduced by 38 percent volunteers’ chances of becoming infected with respiratory syncytial virus, or RSV, when intentionally exposed to the virus.

—After months of lobbying by Governor Deval Patrick, the Massachusetts House finally passed its version of Patrick’s 10-year, $1 billion life sciences bill by a vote of 134 to 13.

—Gearing up for a hoped-for launch of its lead drug candidate next year, Cambridge, MA’s Targanta Therapeutics Corporation (NASDAQ: TARG) yesterday announced it’s hiring a Chief Commercial Officer and a Vice President and General Counsel. The former position will be filled by Mona Haynes, a veteran of Acusphere, Alkermes, and Baxter Healthcare; the latter slot will be filled by Daniel S. Char, who has served as counsel to Idenix Pharmaceuticals and Biogen Idec

—In other personnel news from yesterday, fellow Cambridge biotech Momenta Pharmaceuticals (NASDAQ: MNTA) announced that it has appointed James M. Roach as Chief Medical Officer and Senior Vice President of Development. Roach previously was a senior manager at Sepracor, Millennium Pharmaceuticals, LeukoSite, and Astra USA.

—Finally, the past week saw a flurry of news about Cambridge, MA’s Biogen Idec (NASDAQ: BIIB). Last Wednesday, the FDA posted on its website a letter that Biogen and Ireland’s Elan had sent to physicians alerting them of the risk for liver damage in patients treated with Tysabri, a drug for multiple sclerosis and Crohn’s disease. The risk had been discussed with the FDA and made public months earlier, but the new attention seemed to cause a little dip the company’s stock. On Friday, shares took about a $2 hit when Biogen priced $1 billion of senior notes. And yesterday there was a somewhat odd story in Reuters that cited an analyst report citing an abstract from an upcoming neurology conference that said that JC virus has been found in two Tysabri users; the virus can cause the deadly brain infection progressive multifocal leukoencephalopathy (PML) but didn’t in these cases. (You may remember that Tysabri was temporarily pulled from the market a few years back after three of its users contracted PML.) The analyst retracted his report later that day, according to another Reuters story, after the medical association organizing the conference threatened legal action against his bank and others for violating an embargo on the conference materials.

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Boston Scientific (NYSE: BSX) disclosed in an annual report filed today with the SEC that the Department of Justice is conducting a civil investigation of allegations that the Natick, MA firm and other manufacturers promoted off-label uses of biliary stents. The company indicated it plants to cooperate with the investigation, though none of its documents have been subpoenaed.

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