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West Coast Biotech Roundup: Hutch, Gilead, Soon-Shiong IPO & More

Xconomy San Francisco — 

After a week off, the roundup is back. Up in Seattle, comments that the president of the Fred Hutchinson Cancer Research Center made a month ago raised some fresh hackles. In San Francisco, Gilead Sciences raised the roof with its quarterly earnings, Foresite Capital raised $450 million, and the Gladstone Institutes raised a much smaller amount for an unusual Alzheimer’s venture. In San Diego, Patrick Soon-Shiong’s immunotherapy company NantKwest raised $207 million in an IPO, and a judge raised the stakes in a contentious academic lawsuit. Before you raise hell about my verbal gimmickry, let’s get to the roundup.

—About a month ago, Hutch president Gary Gilliland told a conference audience, and then a CNBC interviewer, that cures for cancer could come within 10 years. He said other optimistic things, too (“cancer is running scared”), especially about so-called CAR-T immunotherapy, and repeated some of the same points in each appearance. But he didn’t disclose—at least in the CNBC interview—that the Hutch has scientific and financial ties to cancer companies, none more prominent than CAR-T developer Juno Therapeutics (NASDAQ: JUNO). (A Hutch spokesman told Xconomy this week that the institute’s four percent stake in Juno doesn’t require disclosure.) The comments brought a round of criticism this week, such as the comments in this article and from prominent biotech blogger Derek Lowe.

—Gilead Sciences (NASDAQ: GILD) hit its second quarter earnings out of the park, thanks to better-than-expected sales of its hepatitis C drugs sofosbuvir (Sovaldi) and Harvoni. Sovaldi is now the most successful drug launch ever. The windfall is prompting no shortage of chatter about Gilead making some acquisitions, as the earnings call Tuesday showed (h/t Fierce Biotech).

—A San Diego judge said last week she will issue a preliminary injunction that requires the University of Southern California and former UC San Diego scientist Paul Aisen to surrender custody of a nationwide Alzheimer’s disease study. Aisen was overseeing the Alzheimer’s Disease Cooperative Study (ADCS) for UC San Diego before joining USC in June. UCSD filed a civil suit seeking to regain control over the study and data from clinical trials done since the study was founded in 1991. According to minutes of the hearing, Superior Court Judge Judy Hayes also plans to name a special master and consultant to ensure that the ADCS computer system and data are protected until the litigation is resolved.

—The New York Times reported Wednesday that the active ingredient of an experimental anemia treatment from San Francisco’s FibroGen is being used as an illicit performance booster by competitive cyclists.

—In Southern California, Patrick Soon-Shiong saw one of the entities in his sprawling life science empire go public. NantKwest (NASDAQ: NK), of San Diego suburb Cardiff-by-the-Sea, raised $207 million, selling 8.3 million shares at $25 a piece. Celgene, which bought one of Soon-Shiong’s previous companies for $2.9 billion, is a NantKwest investor, as is fund manager Franklin Templeton. But as with his other efforts that went public, Soon-Shiong will remain in control of the company, according to regulatory documents.

—The La Jolla Institute for Allergy & Immunology and the UC San Diego Health System agreed to establish a formal affiliation, after working together informally since the institute was founded in 1988. UCSD will provide $36 million over the next 12 years to help the La Jolla Institute recruit and retain scientists. All the institute’s 272 scientists will become adjunct professors at UC San Diego, boosting the university’s expertise in immunology.

—Newark, CA-based drug maker Depomed rejected the latest takeover bid from Irish rival Horizon Pharma. On July 21, Horizon offered $33 a share, bumping up from a previous offer of $29.50 a share. Depomed shares were in the low-$20 range when Horizon’s takeover campaign went public in early July. They closed Thursday at $30.53.

—Foresite Capital, a late-stage healthcare investor based in San Francisco, raised $450 million for its third fund.

—The family of audio pioneer Ray Dolby is putting his fortune into Alzheimer’s research and drug development. After two seed investments in startups last fall, Dolby Family Ventures unveiled last week a novel arrangement to fund at least two drug programs that originated at San Francisco’s Gladstone Institutes.

—SutroVax, a spinout from Sutro Biopharma of South San Francisco, CA, said last week it has raised $22 million in Series A cash to push its vaccine technology forward. The company has not yet said which diseases it plans to protect against.

—Eli Lilly (NYSE: LLY) said it plans to more than double the size of its R&D facility in San Diego and add as many as 130 jobs, mostly for research scientists. The expansion is meant to accelerate the Indianapolis-based drug maker’s work in immunology and other core therapeutic areas.

Xconomy San Diego editor Bruce V. Bigelow contributed to this report.

Image Alcatraz Island courtesy Brian Shamblen via a Creative Commons license.