2019 pharmaceutical industry focuses on value investment

"We should not expect 2019 to be a new drug harvest year like 2018 ——At last year's JPM, Jamie Munro's biopharmaceutical trade trend analysis showed that as targeted therapy continues to cause changes in the field of cancer treatment, as well as other treatment fields, especially in neuroscience and anti infection fields, facing clinical and financial difficulties, the trade in the industry will continue to develop rapidly Laura Vitez, head of business insight at cortellis, and Jamie Munro, global head of life science consulting at Corellis, conclude that the challenge in the future is to bring value to the enterprise through transactions against the backdrop of rising R & D costs, increasing pricing pressures and the shift of business focus from M & A to business development Munro said Bristol Myers Squibb's $74 billion acquisition of celgene, the largest in the history of Biopharmaceutics, had "made the opening of jpm-2019 fascinating," especially given celgene's historic position as the premier showcase company in the banquet hall of the St Francis Hotel in Westin Giovanni caforio, President and chief executive officer of BMS, and mark alles, President and chief executive officer of celgene reached a consensus of sincere cooperation and sharing honor and Disgrace in a warm and friendly atmosphere (see BioWorld, January 4, 2019) in addition, Munro told BioWorld that through the optimization and adjustment of key product mix and personnel reduction, the transaction is expected to save about 2.5 billion US dollars by 2022, which is about 13% of the estimated joint expenditure, which is an interesting start In fact, the biopharmaceutical deal in 2019 has become more crazy on the opening day of JPM, because Eli Lilly ——Pharmaceutical companies that analysts believe are under pressure to fully open their reserves in BMS firepower immediately announced the acquisition of Loxo oncology company with a cash per share of $235 (a total of about $8 billion), which included recently approved vitrakvi (larotrecinib) and a number of candidate drugs in the research and development stage to target cancer treatment assets (see the story of January 8, 2019) according to the data of corellion, Lilly has almost fallen to the middle of the global top 30 pharmaceutical company's annual trading volume ranking in 2018 (including merger and acquisition, authorization, joint venture and R & D transactions), far behind Roche, Novartis, Merck, Johnson & Johnson, AstraZeneca and Pfizer Munro believes that the acquisition of Loxo can help ease the pressure of internal investment and shareholder value creation felt after the BMS celgene transaction While "interesting every year," he added, 2018 was impressive because of BD's predictability The number of transactions in life sciences decreased from 4522 in 2017 to 4014, but the total volume of transactions increased to $428 billion from $392 billion last year, indicating that "if the transaction is satisfactory, money is not a problem." Although the total M & A transactions are still less than the peak of nearly ten years reached in 2014 - $347 billion, the growth of several consecutive years, together with the heavyweight transactions at the beginning of 2019, indicates that the total transactions are likely to break through in this year Compared with the US dollar, the average and median value of licensing transactions reached a record 10-year high of US $371 million and US $101 million, respectively "Since 2014, the overall growth of licensing transactions has been very significant." Munro said According to Munro, from the perspective of treatment field, cancer is firmly dominated by 515 licensing agreements, and the top ten transactions in the industry are all focused on immune tumor (I-O) In contrast, 183 licensing agreements signed in the field of Neuropsychiatry were the second largest category in 2018, with another 129 licensing agreements related to the treatment of infectious diseases In terms of more than $1 billion in licensing transactions, 14 out of 29 focused on cancer treatment and 7 on neurology Fifteen transactions focused on cell / gene therapy or oligonucleotides, and protocols involving oncolytic viruses were also emerging for the first time in major BD activities Seven of the top 20 cash advance authorization transactions in 2018 were Neurology (3), oncology (2) and autoimmune / inflammatory (2) R & D phase transactions Among them, the largest one is a 10-year US $1 billion cooperative R & D agreement signed by Biogen and Ionis Pharmaceutical Co., Ltd., including US $375 million in advance payment and US $625 million in purchase of approximately US $54.34 per share (a premium of about 25%) (see BioWorld, April 23, 2018) in 2018, only two licensing agreements exceeded the prepayment threshold in total Most of them are the US $1.85 billion agreement between BMS and nektar therapeutics Inc on I-O treatment - US $1 billion in cash plus US $850 million in stock - used to evaluate the therapeutic effect of nktr-214 combined with opdivo (nivolumab) or opdivo combined with yervoy (ipilimumab) on more than 20 indications of 9 tumors in the registration related clinical trials The second is the 800 million US dollars of United therapeutics Corp in the field of cardiovascular treatment for arena pharmaceuticals Inc., a prostacyclin receptor agonist for pulmonary hypertension (see BioWorld, February 15, 2018 and November 16, 2018) the buyer still retains a "degree of rationality" overall, the prepayment of most licensing transactions is far less than $100 million "Although the total volume of transactions is rising, the advance payment is not obvious," Munro said This shows that the buyer still retains "a certain degree of rationality" when negotiating In 2018, Chinese biopharmaceutical companies showed a huge demand for interregional deals in order to expand access to innovative drugs in the country, although foreign deals were dwarfed by domestic deals in the US, Munro said "Like everything in China, the growth of biopharmaceutical trade in China is very eye-catching," he added The largest representative deal was a $722 million potential agreement for the bispecific antibody platform, including an advance of $20 million The deal gives Baiji access to zymeworks' azymetric and efect platforms, as well as global development and commercialization rights for up to three additional bispecific antibodies In addition, zymeworks transferred its HER2 interest in Asia (excluding Japan), Australia and New Zealand to Baekje with a prepayment of up to $430 million, including $40 million (see BioWorld, November 28, 2018) "China's performance was expected, but now it's our focus." Munro said The story of biopharmaceutical IPO in 2018 is also impressive Although it is less than the ten-year peak set in 2014, the number of new IPO issues in 2018 has achieved a sustained back-to-back growth since 2016, and the overall valuation has reached a record high Venture capital also remained active After three years of strong growth, private capital investment in drug research and development has increased to about $17.4 billion (see BioWorld, October 18, 2018 and December 10, 2018) "VC companies express willingness to invest in companies with attractive assets and value propositions." Munro pointed out The results of biopharmaceutical transactions also showed positive returns, because the number of new molecular entities approved by FDA reached a record high of 59, and the two approvals at the end of December were even more surprising, one was stemline therapeutics The first drug is used for the treatment of acute plasmacytoid dendritic cell tumors in rare bone marrow and hematologic diseases The other is alexion pharmaceuticals Inc.'s ultomiris (alxn-1210, ravulizumab), a long-acting C5 complement inhibitor, which is used to treat adult patients with paroxysmal nocturnal hemoglobinuria in rare hematologic diseases (see BioWorld, December 24, 2018 and BioWorld insight, December 31, 2018.) However, Munro also pointed out that for the first time in history, the number of approved orphan drugs exceeded that of non orphan drugs, and the number of large pharmaceutical companies approved new drugs also declined Even anti-cancer drugs, applications to orphan drug design have begun to pile up, with the result that more and more approvals are only for smaller patient groups Although many drugs were subsequently approved for use in more patients - keytruda (pembrolizumab, Merck & CO) The increase in the number of applicable patients of Inc.) is a noteworthy example in the field of cancer - in view of the rapid growth of orphan drug approval, it remains to be seen whether the general population of patients can benefit from new drug approval He added: it is worth noting that the number of new drug applications that are not approved is declining, so the success rate of new drug applications will increase as the company has a better understanding of the future of its advanced products (see bioworldinsight, December 24, 2018) in the end, Munro said: "this is a good thing for the industry and proves that the regulatory system works well But the number of documents submitted is also declining, so we should be careful not to expect 2019 to be a new drug harvest year like 2018 " This article is excerpted from BioWorld insight, January 8, 2019 Original author: Marie powers Editor: wonger / proofreader: eryoumu 2019j P Morgan During the period, coreway released the latest annual "2018 global pharmaceutical trade overview report" and missed the attendance Ren can directly participate in the online release of the Chinese version on March 14, and is honored to invite experts from the industry to interact with you online.