Can The Government Squash Biotech Advancements?
Drug pricing legislation headlines returned with the announcement of an FTC workshop on anti-trust laws in pharma scheduled for mid-June. With the failure of the Build Back Better legislation any drug pricing reforms would need to be passed through reconciliation. Policy analysts continue to view adoption of material reforms as unlikely given disagreement on specific policy proposals across key stakeholders and a tight timeline that would be required (Note the reconciliation window closes September 30th, lawmakers have recess starting June 28th, then they are back for a few weeks in July, then out again on recess in August). Through 6/7/2022:
Washington's inertia is in contrast to a pickup in strategic deal activity focused on oncology this past week headlined by the $4 billion acquisition of Turning Point Therapeutics (TPTX) by Bristol Myers Squibb (BMY). The deal was a 122% premium to the prior close and showed the continued interest of big pharma for differentiated targeted oncology assets. TPTX was recently granted breakthrough therapy designation by FDA for lead drug candidate repotrectinib, a small molecule kinase inhibitor targeting the ROS1 and TRK oncogenic drivers of non-small cell lung cancer and advanced solid tumors.
BMY also expanded a collaboration deal with Immatics (IMTX) to develop gamma Delta Allogeneic cell therapy programs for oncology indications for $60 million upfront and up to $700 million in milestones plus a tiered royalty. Regeneron (REGN) acquired partner Sanofi's (SNY) stake in immuno-oncology therapy Libtayo (cemiplimab) for an upfront payment of $900 million (plus royalties and milestone payments) to expand the revenue potential of their oncology business. Roche (RHHBY) ponied up $125 million plus $1.2 billion in potential milestones to collaborate with Repare Therapeutics (RPTX) for camonsertib (RP-3500), a potent and selective oral small molecule inhibitor of ATR (Ataxia-Telangiectasia and Rad3-related protein kinase) for the treatment of tumors with specific synthetic-lethal genomic alterations including those in the ATM gene (Ataxia-Telangiectasia mutated kinase). Roche commented the deal enabled them to expand into the emerging DNA damage response field.
All of these deals have the potential to develop products that extend the lives of patients battling cancer and no politician wants to say that we shouldn't pay for that.