After two years of good vibes, rising valuations, and booming IPOs, biotech stocks finally began feeling the heat this week. Since last Friday, when politicians hammered Gilead Sciences (NASDAQ: GILD) for the price of its new hepatitis C drug, sofosbuvir, the Nasdaq Biotechnology Index has plummeted 10 percent. Is the worst over, or is a larger correction coming? We’ll find out in the ensuing weeks and ahead. For now, here’s your East Coast news:
—Cambridge, MA based Neurophage has spent years fine-tuning a way to break up disease-causing plaques in the brain. This week, it loaded up with enough cash to test that method out in its first clinical trial. Neurophage raised a $17 million Series D round of equity financing from existing and new investors—“primarily insiders,” CEO Jonathan Solomon told me—to gear up for the first trial of its lead drug, NPT088. Neurophage didn’t reveal the names of its new investors, but its current backers include Shire, Merieux Developpement, and private angel investors. The company has now raised $52 million since its inception in 2007. I profiled Neurophage, and the fortuitous lesson it learned from a virus that infects bacteria, back in January.
—This week, we revealed the agenda for our latest life sciences event, “What’s Hot in Boston Biotech,” which will take place on April 16 at Biogen Idec in Cambridge, MA. It’ll be a series of panels, stories, and in-depth, interactive discussions about big biotech ideas, emerging models of collaboration between industry and academia, and new, untraditional financing sources that would’ve been unthinkable for startup biotechs just a few years ago. Some of the scientific concepts we’ll be highlighting: gene editing with CRISPR/Cas9, microbiome therapies, RNA interference, and “super enhancers.”
—Another clinical trial for Monmouth Junction, NJ-based Insmed (NASDAQ: INSM), more head-scratching on Wall Street. Insmed had created a new kind of primary goal for the study of its inhalable antibiotic, liposomal amikicin (Arikayce), in patients with nontuberclsis mycobacterial lung infections: a statistically significant reduction in “mycobacterial density,” a measurement of the amount of bacteria in the lungs. Insmed did this because it didn’t expect to achieve a more difficult goal: “culture conversion,” or, wiping out the bacteria entirely. Insmed instead left this as its secondary goal. So, naturally, what happened? The Insmed drug failed on the first count, and succeeded on the second. This led to a wild day on Wall Street in which shares plummeted almost 30 percent, and then rallied to close down about 13 percent, as a flood of sell-side analyst reports came to the company’s aid. Insmed plans to seek the “breakthrough therapy” designation from the FDA based on the positive secondary results. Insmed drew the wrath of investors last year when it trumpeted success for a trial testing its drug in patients with lung infections related to cystic fibrosis, but a slide from its data presentation made it clear that it performed a little worse than Novartis’ tobramycin inhalation powder (Tobi), the comparator in the trial.
—Waltham, MA-based Syndax Pharmaceuticals is looking to Wall Street to help fund a 600-patient, late-stage clinical trial for its experimental cancer drug, entinostat. Syndax plans to raise up to $69 million through an IPO and trade on the Nasdaq under the ticker symbol “SNDX.” The company will kick off the study in April, and expects to produce data in mid-2017. Syndax wants to position entinostat as an add-on to hormone therapy for people with certain forms of breast cancer.
—Biogen Idec (NASDAQ: BIIB) will provide $5.25 million to the Whitehead Institute for Biomedical Research at MIT as part of three-year deal to support the early-stage research projects led by the non-profit institution’s investigators in immunology, neurology, developmental biology, genetics, and genomics. Biogen and Whitehead scientists will work together on the projects, and a joint committee from both organizations will determine which of them get funded.
—Sanofi’s Genzyme unit exercised its option to buy 344,448 more shares of Cambridge-based Alnylam Pharmaceuticals (NASDAQ: ALNY) as part of the big strategic deal the two companies struck earlier this year. Genzyme bought the shares at $66.68 apiece, for a total of about $23 million, giving it a roughly 12 percent stake in Alnylam. Genzyme paid $80 per share, or $700 million overall, to deepen its ties with Alnylam’s RNAi programs in January.
—Lexington, MA-based scPharmaceuticals raised a $16 million Series A round co-led by 5AM Ventures and Lundbeckford Ventures to develop a technology to deliver biotech drugs via a self-injection just under the skin. The company is the latest incarnation of an outfit once known as Entra Pharmaceuticals, and later SpringLeaf Therapeutics, which raised more than $20 million but ran out of cash before it could get to its first clinical trial. Former SpringLeaf CEO Pieter Muntedam snapped up some of the company’s assets before it folded, and launched scPharmaceuticals around them. The company is now developing a drug-device combination incorporating a new formulation of the generic heart failure drug furosemide into a wearable pump that would, in theory, enable patients to avoid going to the hospital to receive the drug intravenously. It’s also working on a similar device to deliver the antibiotic cephalosporin.
—New York-based Retrophin (NASDAQ: RTRX) closed its $62.5 million buyout of Fort Collins, CO-based Manchester Pharmaceuticals, and said this week that it will immediately seek clearance from the FDA to begin selling one of the drugs it got in the buyout, chenodeoxycholic acid (Chenodal), to patients with a rare inherited disease called cerebrotendinous xanthomatosis. I profiled the Retrophin deal back in February.
—Just a few weeks after raising $38 million and perhaps signaling an IPO might be on the way, Cambridge-based Sage Therapeutics dosed the first patient in its first clinical trial. The company has begun testing its lead drug candidate, SAGE-547, in patients with status epilepticus, a life-threatening form of epilepsy. Sage aims to enroll 10 to 15 patients in the study.
—Cambridge-based Bluebird Bio (NASDAQ: BLUE) had similar news this week. The company dosed the first patient in its Phase I/II trial with its lentiviral gene therapy for beta-thalassemia, known as LentiGlobin, or BB305. Bluebird will enroll up to 15 patients in the study.
—Rensselaer, NY-based Pulmokine won a three-year contract worth up to $1.5 million from the National Heart, Lung, and Blood Institute to develop an inhalable treatment for pulmonary arterial hypertension. The contract will fund the studies needed to get Pulmokine to the point of filing an investigational new drug application.