2015 Dealmaking Outlook Ed Saltzman President Defined Health
NYPF Meeting - New York, NY 23 March 2015
Page 2 NYPF Meeting – 23 March 2015 © Defined Health
Biotech IPOs Are Approaching Historic Highs
http://www.biospace.com/News/biotech-ipos-up-22-since-bubble-year-of-2000-shows/361523
Page 3 NYPF Meeting – 23 March 2015 © Defined Health
As Are Early Stage Deal Valuations
EvaluatePharma
Top Licensing Deals in 2014
Company Deal Partner Product Status on Deal Date (2014)
Deal Value ($m) Upfront
Payment ($m)
Dainippon Sumitomo Edison Mitochondrial Disease Research Research project 4,295 50
Pfizer Merck KGaA MSB0010718C Phase II 2,850 850
Celgene Nogra Pharma GED-0301 Phase II 2,575 710
Merck & Co Ablynx Nanobody Research Research project 2,365 27
Merck & Co Bayer Adempas Marketed 2,100 1,000
Takeda MacroGenics DART Program Research project 1,600 -
Servier Intarcia Therapeutics ITCA 650 Phase III 1,452 171
BMS CytomX Therapeutics CTLA-4 Research Research project 1,242 50
Roche NewLink Genetics NLG919 Phase I 1,150 150
Novartis Ophthotech Fovista Phase III 1,030 200
AstraZeneca BMS Farxiga Marketed 1,000 50
Baxter Merrimack MM-398 Phase III 970 100
J&J Geron Imetelstat Phase II 935 35
Sanofi Mannkind Afrezza Approved 925 150
J&J Aduro BioTech ADU-214 Pre-clinical 847 30
Servier Cellectis UCART19 Pre-clinical 840 -
Page 4 NYPF Meeting – 23 March 2015 © Defined Health
Symptom Not Cause: IPOs are Cyclical but Drivers of Hot Early Stage Deal Market are Fundamental and Will Persist
♦ Pharma’s reduced discovery footprint
Drives need to fill early pipelines externally
♦ Payers increasingly powerful in all major markets
Raising bar for innovation
♦ De-risked deals no longer feasible or affordable for Pharma
Mid and large cap biotechs no longer affordable
Despite “headline deals” clinical stage deal volume and valuations actually declining as majority of programs lack PoR and carry too much commercial risk
♦ Pre-clinical deals proliferating in volume and value
♦ Early deal space hottest in immuno-oncology and regenerative medicine
“Overnight” scientific disruption in areas long shunned by Pharma
Pharma must move quickly and scarcity drives valuations
Page 5 NYPF Meeting – 23 March 2015 © Defined Health
Benefit of Patent Cliff-Driven Cost Reduction Was to Shrink, Focus and Externalize R&D
Company website, EvaluatePharma, GoogleEarth
Page 6 NYPF Meeting – 23 March 2015 © Defined Health
But Especially the “R” Part
Pfizer Plans to Cut Research Spending By Up To $3B February 4, 2010 Pfizer Inc. said Wednesday that it plans to cut research-and-development spending by as much as $3 billion by 2012, in an attempt to wring efficiencies following its take-over of Wyeth without sacrificing future product development. The New York pharmaceutical giant outlined the aggressive cuts, which represent more than a quarter of the two companies' combined research budgets in 2008, as it reported fourth-quarter earnings of $767 million, or 10 cents a share, up from $266 million, or four cents a share, a year earlier. The drug maker also forecast lower financial targets from the Wyeth deal than it provided last year, sending Pfizer shares down 2.3% to $18.62 on the New York Stock Exchange.
Research is considered the lifeblood of pharmaceutical companies. Big drug makers like Eli Lilly & Co. and Bristol-Myers Squibb Co. are increasing their spending to find new products that can replace aging blockbusters. Yet drug discovery is unpredictable, and industry scientists have struggled in coming up with big new products. Pfizer's announcement suggests executives believe its research hasn't been worth the high levels of investment.
The largest drug makers have been retrenching as blockbuster drugs start facing competition from less expensive generic versions. After early cost cutting focused on trimming sales representatives, companies have set their sights on labs and scientists. Last week, AstraZeneca PLC said it would cut about 3,500 research jobs as part of a larger work-force reduction. Pfizer also targeted research previously, cutting as many as 800 research workers last year and closing six of 20 research sites as part of the Wyeth acquisition completed in October. Meantime, the $68 billion Wyeth takeover and other deals are filling Pfizer's pipeline with therapies discovered elsewhere.
Chief Executive Jeffrey Kindler said he believes Pfizer has struck the "right balance" between efficiency and innovation by embracing deals and partnerships while still investing heavily in internal research. "The days of a monolithic approach to either research or commercialization are behind us," he said. Pfizer said its research expenses would be $8 billion to $8.5 billion in 2012. The combined research spending for the two companies was $11 billion in 2008, the last full year before the merger. Chief Financial Officer Frank D'Amelio said the research cuts are aimed to reduce overlaps in the two companies.The planned cuts are part of a total of $7 billion in savings Pfizer expects to realize from both the Wyeth deal and its cost-cutting efforts begun before the acquisition. Pfizer will still have among the industry's biggest research budgets, company officials said. Chief executives at GlaxoSmithKline PLC and Sanofi-Aventis SA have talked about the poor returns from company labs and reworking their approach to drug development. Sanofi Chief Financial Officer Jerome Contamine said in July that the company planned to cut R&D spending by 20% between 2008 and 2011.Consultants like Terry Hisey, vice chairman and U.S. life sciences leader at Deloitte LLP, is telling drug makers that it is "more cost effective" to bring in promising therapies from the outside than trying to develop them all in-house. Yet Sanford Bernstein analyst Tim Anderson said the research cuts by drug conglomerates could "come back to bite" the companies because they will need new products.
The Wall Street Journal: http://online.wsj.com/article/SB10001424052748704259304575042863590302630.html?mod=WSJ_newsreel_business
Pfizer's announcement suggests executives believe its research hasn't been worth the high levels of investment.
Page 7 NYPF Meeting – 23 March 2015 © Defined Health
Majority of R&D Now Externalized: Trend Will Accelerate and Shift is Permanent
EvaluatePharma, PhRMA website, DH estimates
R&D Spend in US Pharma on Self-Originated vs. Licensed-In Projects
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
% R&D SpendUncategorized
% R&D Spend onLicensed-In Projects
% R&D Spend on Self-Originated Project
<---------------- DH Projected -------------->
Page 8 NYPF Meeting – 23 March 2015 © Defined Health
Cutting R&D Has Created Shareholder Value in Post-Cliff World
EvaluatePharma, Defined Health analysis
Loss of over 1/3 of combined
market cap
0
475
950
1,425
1,900
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2014
NVS PFE GSK MRK ROC SNY AZN JNJ ABT BAY BMS LLY
PFE MRK GSK JNJ BMS NVS LLY AZN ROC WYE PHA ABT AVE SGP SNY DNA BAY SHR
WYE->PFE SGP->MRK DNA->ROC AVE->SNY PHA->PFE SHR->BAY
Combined Market Cap ($B) of Top Pharma Companies (2000-2014)
Page 9 NYPF Meeting – 23 March 2015 © Defined Health
0
200
400
600
800
1,000
1,200
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Phase 1
Pre-Clinical
EvaluatePharma
Number of Pre-Clinical and Phase 1 Programs in Top 10 Pharma Pipelines (2003-2013)
But Cuts to Discovery Also Result in Shrunken Early Stage Pipelines That Need to be Refilled
Page 10 NYPF Meeting – 23 March 2015 © Defined Health
Which Defined Health Predicted Nearly Five Years Ago
Page 11 NYPF Meeting – 23 March 2015 © Defined Health
Pharma Long Preferred Commercial Over Scientific Risk
Page 12 NYPF Meeting – 23 March 2015 © Defined Health
Pharma Achieved Historical Success Buying De-Risked Innovation
Page 13 NYPF Meeting – 23 March 2015 © Defined Health
But Innovation via Biotech M&A no Longer Affordable for Pharma
0
50
100
150
200
250
300
Novartis Roche Pfizer Merck Sanofi Gilead Amgen Celgene BiogenIdec
EvaluatePharma; MC as of 20-March-2015
Market Caps of Selected Top Pharma vs Top Biotechs ($ billion)
Page 14 NYPF Meeting – 23 March 2015 © Defined Health
Commercial Risk Already Substantial Will Only Get Worse
http://www.fiercepharma.com/special-reports/top-10-drug-launch-disasters
Page 15 NYPF Meeting – 23 March 2015 © Defined Health
So Pharma Clearing Out Products That Cannot Be Sold
Citeline analytics, Parexel Biopharmaceutical R&D Statistical Sourcebook 2013/2014, total reports each year range from 99-209, only drugs with actual declared reasons are included
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2003 2004 2005 2006 2007 2008 2009 2010 2011 Overall2001-2011
OtherSpecified
Strategic
Financial
Efficacy
AdverseEvents
Reported Reason
Reported Reasons for Drug Discontinuations 2003-2011
Page 16 NYPF Meeting – 23 March 2015 © Defined Health
Longstanding View of Value Inflection in Process of Disruption
http://www.nature.com/bioent/building/planning/012003/fig_tab/nbt0602supp-BE36_F2.html
“Today, the big inflection points are: i. initial P2 results, which suggest efficacy ii. advanced P3 trials, which lead to a New Drug Application (NDA), and iii. market launch.”
Source: Nature Biotechnology 20, BE36-BE39 (June 2002) Based on: Burrill & Co., and Ernst & Young, 1997
Page 17 NYPF Meeting – 23 March 2015 © Defined Health
Supply of “Available” Clinical Stage Programs Remains Healthy
Data analysis provided courtesy of Thomson Pharma IDdb
Number of Unpartnered Compounds Owned by Non-Commercial Stage Biotechs
0
500
1000
1500
2000
2500
2000 2004 2006 2007 2008 2009 2010 2011 2012 2013
Phase 3
Phase 2
Phase 1
Page 18 NYPF Meeting – 23 March 2015 © Defined Health
But Still Far Exceeds Demand
EvaluatePharma, Thomson Reuters
0%
5%
10%
15%
20%
2000 2004 2006 2007 2008 2009 2010 2011 2012 2013
Phase 2
Phase 1
Deals as a Percentage of Biotech Programs by Phase
Page 19 NYPF Meeting – 23 March 2015 © Defined Health
And Clinical Phase Deal Values are Declining
Therapy Area Product deal count Up-front payments ($m) Total deal value ($m)
2010 2011 2012 2013 2010 2011 2012 2013 2010 2011 2012 2013
Oncology & Immunomods 51 93 51 52 713 662 446 425 3,408 6,713 5,360 3,570
Systemic anti-infectives 25 34 33 31 398 50 204 49 1,226 226 774 675
Central nervous system 42 49 22 32 199 297 105 506a 2,884 2,488 874 3,373a
Gastro-intestinal 19 21 13 9 108 23 85 70 1,765 76 504 70
Respiratory 13 14 11 3 10 58 22 0 25 150 82 0
Musculoskeletal 6 13 10 14 145 100 189 45 1,455 347 1,659 560
Endocrine 8 14 8 6 95 409 0 127 2,155 3,146 0 677
Cardiovascular 17 16 7 14 148 2 0 25 2,421 9 54 825b
Dermatology 12 5 6 7 0 0 40 0 0 0 52 0
Various 8 6 6 9 45 5 23 0 373 23 26 0
Blood 8 7 4 9 167 2 0 400c 1,094 364 2 1,000c
Genito-urinary 17 7 3 11 213 0 0 5 1,364 0 0 146
Sensory organs 7 10 1 12 60 45 0 0 230 420 0 0
Totals 233 289 175 229 2,301 1,652 1,114 1,651 18,399 13,961 9,387 10,896
EvaluatePharma report - Therapy area licensing in 2012 – Rags and riches
Phase 1 to Phase 3 Product Deal by Therapy Area
a CNS increase: Lilly/Pfizer deal for Tanezumab; $200M upfront, $1,780M total deal value b CV increase: Forest/Trevana deal for AT-1 antag; $460M total deal value c Blood increase: AZN/Fibrogen deal for Roxadustat; $400M upfront, $815M total deal value
Page 21 NYPF Meeting – 23 March 2015 © Defined Health
PoR has Replaced PoC as Deal Value Driver
Proof of
RelevanceTM
Page 22 NYPF Meeting – 23 March 2015 © Defined Health
PoR Reflects a Balance of Commercial and Scientific Risk Appropriate for Tomorrow’s Environment
Page 23 NYPF Meeting – 23 March 2015 © Defined Health
Cancer Continues to Dominate in Deal Volume
IMS Pharma Deals
Number of Product Deals by Therapeutic Area, 2010-2014
Page 24 NYPF Meeting – 23 March 2015 © Defined Health
Immuno-Oncology Deals Have Largest Upfront Payments
Thomson Reuters
Page 25 NYPF Meeting – 23 March 2015 © Defined Health
Overall Deal Values Highest in Immuno-Oncology
Thomson Reuters
Page 26 NYPF Meeting – 23 March 2015 © Defined Health
Strong Start for Immuno-Oncology Deals in 2015
Date Acquirer Originator Platform/Product Phase Terms
1/5/2015 Amgen Kite ACT: CART PC
Kite to receive a $60M upfront payment; eligible for up to $525M in milestone per Amgen program; tiered high single- to double-digit royalties for sales and license of Kite's IP for CAR T cell products; Amgen eligible to receive up to $525M in milestones per Kite program; plus, tiered single-digit sales royalties
1/9/2015 Incyte Agenus Checpints and costims: GITR, OX40, LAG-3 and TIM-3
PC Agenus to receive $60M ($25M access fee plus $35M equity investment); also up to $350M milestones across the four lead programs
1/12/2015 MedImmune Omnis OV -Genetically engineered strain of VSV
P1 ND
1/21/2015 Celgene Zymeworks Bispecific PC
Zymeworks to receive initial upfront payment, and equity investment; eligible for up to $164M in milestones per successful therapeutic candidate; also to receive royalties on WW net sales
1/27/2015 Janssen Macrogenics Bispecific T-cell engager PC
MacroGenics to receive $50M upfront; J&J also invested $75M in purchase of new shares of MacroGenics common stock; Janssen will be fully responsible for developing MGD011 following submission of IND (2015); also up to and additional $575M in milestones and eligible for double-digit royalties and copromotion in the US
EvaluatePharma, Defined Health
26
Page 27 NYPF Meeting – 23 March 2015 © Defined Health
Strong Start for Immuno-Oncology Deals in 2015
Date Acquirer Originator Platform/Product Phase Terms
2/11/2015 Incyte Advaxis Vaccine: ADXS-HPV P2
Non-exclusive collaboration to evaluate the combination of ADXS-HPV with IDO1 inhibitor for cervical cancer; both companies will collaboratively conduct and fund the study, results to determine whether further clinical development is warranted
2/23/2015 BMS Rigel TGF-beta kinase inhibitors PC
BMS to obtain exclusive, WW rights to develop and commercialize small molecule therapeutics derived from Rigel’s TGF beta library, including, but not limited to, those approved to treat cancer; BMS to pay $30M upfront; Rigel eligible to receive up to $309M in milestones and tiered royalties on sales
2/23/2015 BMS Flexus IDO1 inhibitors PC
BMS buying out Flexus; including $800M upfront for PC immunotherapy that shows promise in treating cancer, with another $450 million set aside for milestones
3/4/2015 BMS Bavarian Nordic Vaccine: Prostvac P3
Bavarian Nordic to receive up to $975M including $80M upon exercise of the option plus additional incremental payments starting at $50M, but with a potential to exceed $230M should the median overall survival benefit of PROSTVAC exceed the efficacy seen in P2 results; also up to $495M in milestones and tiered double-digit royalties on sales
EvaluatePharma, Defined Health
27
Page 28 NYPF Meeting – 23 March 2015 © Defined Health
Soon This Type of Thing Will No Longer Be News
Novartis Announces Clinical Collaboration to Evaluate Bristol-Myers Squibb's Novel Immunotherapy in Combination Treatments for NSCLC October 06, 2014
Phase I/II studies will evaluate Zykadia(TM), INC280 and EGF816 in combination with Bristol-Myers Squibb's investigational immunotherapy Opdivo®
Combination studies will evaluate compounds that have demonstrated evidence of targeting mutations associated with tumor growth in patients with NSCLC
Collaboration highlights promising new treatment approach for patients and underscores Novartis' commitment to patients and the lung cancer community
Novartis announced today that it has entered into a clinical collaboration with Bristol-Myers Squibb Company (NYSE: BMY) to evaluate the safety, tolerability and preliminary efficacy of three molecularly targeted compounds in combination with Bristol-Myers Squibb's investigational PD-1 immune checkpoint inhibitor, Opdivo® (nivolumab), in Phase I/II trials of patients with non-small cell lung cancer (NSCLC). "Preclinical data suggests that combining molecularly targeted agents with immunotherapies such as nivolumab may have synergistic effects and lead to better outcomes for patients," said Alessandro Riva, MD, Global Head, Novartis Oncology Development and Medical Affairs. "This collaboration enables us to study several key compounds, including our new highly-potent ALK inhibitor Zykadia, together with a promising, novel immunotherapy agent, paving the way for potential new treatment approaches for patients with NSCLC."
Both studies will be conducted by Novartis. One trial will evaluate the combination of Opdivo with Zykadia(TM) (ceritinib), an FDA-approved treatment for patients with anaplastic lymphoma kinase-positive (ALK+) metastatic NSCLC who have progressed on or are intolerant to crizotinib[1]. A second study will investigate Opdivo with INC280, a potent and highly selective inhibitor of c-MET receptor tyrosine kinase, and separately with EGF816, a potent, third-generation EGFR tyrosine kinase inhibitor that is active against T790 mutations. INC280 and EGF816 are currently being investigated in various Phase I/II NSCLC trials. Additional details of the collaboration were not disclosed.
This collaboration with Bristol-Myers Squibb further advances Novartis' development efforts in the field of immunotherapy. Earlier this year, Novartis acquired CoStim Pharmaceuticals Inc., adding late discovery stage immunotherapy programs focused on key oncogenic targets, including PD-1. Novartis is also actively investigating the potential of chimeric antigen receptor (CAR) T cell technologies in the treatment of various liquid and solid tumors through its alliance with the University of Pennsylvania.
About Zykadia: Zykadia (ceritinib) is indicated in the US for the treatment of patients with ALK+ metastatic NSCLC who have progressed on or are intolerant to crizotinib. This indication is approved under accelerated approval based on tumor response rate and duration of response. An improvement in survival or disease-related symptoms has not been established. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. Outside of the US, Zykadia (ceritinib) is an investigational agent and has not been approved by regulatory authorities. Regulatory reviews are currently underway in the European Union and several countries within South America, Central America and Asia.
About INC280 and EGF816 Because these are investigational compounds, the safety and efficacy profiles of INC280 and EGF816 have not yet been established. Access to these investigational compounds is available only through carefully controlled and monitored clinical trials. These trials are designed to better understand the potential benefits and risks of the treatments. Because of the uncertainty of clinical trials, there is no guarantee that INC280 and EGF816 will ever be commercially available anywhere in the world. Novartis licensed INC280 from Incyte Corporation and holds exclusive worldwide development and commercialization rights to the compound in all indications.
About Opdivo (nivolumab) Cancer cells may exploit "regulatory" pathways, such as checkpoint pathways, to hide from the immune system and shield the tumor from immune attack. Opdivo is an investigational, fully-human PD-1 immune checkpoint inhibitor that binds to the checkpoint receptor PD-1 (programmed death-1) expressed on activated T-cells. Bristol-Myers Squibb has a broad, global development program to study Opdivo in multiple tumor types consisting of more than 35 trials - as monotherapy or in combination with other therapies - in which more than 7,000 patients have been enrolled worldwide. Among these are several potentially registrational trials in NSCLC, melanoma, renal cell carcinoma (RCC), head and neck cancer, glioblastoma and non-Hodgkin lymphoma. In July, 2014, Opdivo received manufacturing and marketing approval in Japan for the treatment of patients with unresectable melanoma. Opdivo is also under review by the U.S. Food and Drug Administration and European Medicines Agency. Bristol-Myers Squibb has proposed the name Opdivo (pronounced op-dee-voh), which, if approved by health authorities, will serve as the trademark for nivolumab.
http://www.novartis.com/newsroom/media-releases/en/2014/1860778.shtml
One trial will evaluate the combination of Opdivo with Zykadia(TM) (ceritinib), an FDA-approved treatment for patients with anaplastic lymphoma kinase-positive (ALK+) metastatic NSCLC who have progressed on or are intolerant to crizotinib. A second study will investigate Opdivo with INC280, a potent and highly selective inhibitor of c-MET receptor tyrosine kinase, and separately with EGF816, a potent, third-generation EGFR tyrosine kinase inhibitor that is active against T790 mutations. INC280 and EGF816 are currently being investigated in various Phase I/II NSCLC trials.
Page 29 NYPF Meeting – 23 March 2015 © Defined Health
Spike in Collaborative R&D Deals Driven by Immuno-Oncology
IMS Pharma Deals
Page 30 NYPF Meeting – 23 March 2015 © Defined Health
Regenerative Medicine Getting Hot as Programs Near or Beyond PoC
Sectors to Watch in Biotech and Healthcare Investing: Regenerative Medicine 5 August 2014
Regenerative medicine has far-reaching implications for treating numerous devastating and costly diseases. The Alliance for Regenerative Medicine (ARM), a multi-stakeholder advocacy organization, defines regenerative medicine research as that which “translates fundamental knowledge in biology, chemistry and physics into materials, devices, systems and a variety of therapeutic strategies, which augment, repair, replace or regenerate organs and tissue.”
Regenerative medicine has the potential to treat a wide range of chronic and life-threatening diseases and conditions, including cancer, diabetes, genetic disorders, Parkinson’s, Alzheimer’s, ALS, macular degeneration, cardiovascular disease, and stroke. In addition, these advances have the potential to change the economics of both healthcare delivery and drug discovery by allowing for the treatment of the fundamental causes of disease and damage from injury and age. But regenerative medicine isn’t limited to just stem cell or cellular therapies, as is commonly thought. In addition to therapeutics (either alone or in combination with other technologies such as gene editing or bioengineering), regenerative medicine companies are also developing tools to aid in drug development, such as the creation of in vitro models of human disease to enable drug discovery, as well as drug efficacy and toxicity testing. Lastly, companies also are developing drugs that stimulate the body’s own innate capacity to regenerate or repair itself.
According to a recent report from ARM, the field has reached critical mass and has matured enough to be ready for commercial development. There are more than 700 companies worldwide with a regenerative medicine focus and the field is drawing an increasing level of interest and investment from industry, as evidenced by many of the major biopharma companies having active programs underway.
The combined regenerative medicine field, including cell, gene, and gene-modified cell therapies, generated $4.74 billion through partnering deals, acquisitions, and public and private investments from March 2013 to March 2014. There are close to 700 clinical trials currently underway with the largest areas of focus in oncology, CNS disorders, and cardiovascular diseases. And, the clinical pipeline is maturing with over one-third of those trials in later stages (Phase II or III). The rate of growth is reflected in the public markets: 25% of the biotech IPOs in the second half of 2013 were regenerative medicine companies. Gene therapy companies bluebird bio (Nasdaq: BLUE) and uniQure NV (Nasdaq: QURE) raised $116 million and $91.8 million, respectively, in their IPOs; Cellular Dynamics International (Nasdaq: ICEL), a manufacturer of stem cell tools, raised $46.1 million in its IPO. In the private markets, Juno Therapeutics, a cancer immunotherapy company, raised $145 million in its Series A round, one of the biggest ever in biotech.
This year promises to be a banner year with several companies expected to announce clinical trial results in stroke, cardiovascular diseases, cancer, and HIV, and more investigational new drug applications expected for the companies seeking to treat diabetes, Parkinson’s disease, and congestive heart failure, among other diseases.
http://www.poliwogg.com/news/125-sectors-to-watch-in-biotech-and-healthcare-investing
The combined regenerative medicine field, including cell, gene, and gene-modified cell therapies, generated $4.74B through partnering deals, acquisitions, and public and private investments from March 2013 to March 2014. There are close to 700 clinical trials currently underway with the largest areas of focus in oncology, CNS disorders, and cardiovascular diseases. And, the clinical pipeline is maturing with over one-third of those trials in later stages (P2 or P3). The rate of growth is reflected in the public markets: 25% of the biotech IPOs in the second half of 2013 were regenerative medicine companies.
Page 31 NYPF Meeting – 23 March 2015 © Defined Health
Gene and Cell Therapies Becoming Larger Force in Deal Space
Alliance Deal Type Asset / Class Indication (Phase)
Upfront ($MM)
Total ($MM)
Notes
Amgen/ BioVex ACQ
talimogene laherparepvec (HSV-1 Oncolytic vaccine & GM-CSF)
Melanoma (P2)
425 (575 in
Milestones) 1,000
Jan-2011: Amgen definitive agreement to acquire BioVex for $425M in cash plus up to $575M in milestone payments. BioVex will become a wholly owned subsidiary.
Amgen/ Merck Collab.
talimogene laherparepvec in combination with MK-3475
Melanoma (P2)
N/A N/A
Feb-2014: Amgen agreement with Merck to evaluate the safety and efficacy of talimogene laherparepvec in combination with MK-3475 in a P1b/2 study in patients with mid-to-late stage melanoma
Novartis/ UPenn
In-license WW Rights
CTL-019, CAR19-TCells
B-Cell malignancies
N/A
N/A
Novartis exclusive WW license to CARs for all indications & CART-19. Includes up-front payment + research funding + establishment of CACT + milestone payments.
Celgene/ Bluebird
License CAR T-Cell Technology
Juno/ MSKCC/ FHCRC/Seattle Children’s
License, Venture Funding
CAR T-Cell Technology
120 N/A
Juno Therapeutics landed $120 million in series A startup financing in a deal led by Arch Venture Partners and the Alaska Permanent Fund.
EvaluatePharma
2011-2014 Highlighted Cancer Gene Therapy Deals
Page 32 NYPF Meeting – 23 March 2015 © Defined Health
And Large Early Stage Deals Now More Common
Alliance License / Acq Class Phase at signing Upfront ($MM)
Total ($MM)
Pfizer/ Cellectis - T cell therapy Research project 80 2,855
Servier/ Cellectis In-licensed CD19 cell therapy Pre-clinical - 840
GSK/ Adaptimmune In-licensed Anti-NY-ESO-1 T cell therapy Phase II - 350
Intrexon/ MDACC/ U. Minn In-licensed Chimeric antigen receptor (CAR) T cell therapy
Research project - 110
ZIOPHARM Oncology/ MDACC/ U. Minn
In-licensed Chimeric antigen receptor (CAR) T cell therapy
Research project - 110
Amgen/Kite Pharma In-licensed Chimeric antigen receptor (CAR) T cell therapy
Research project - -
Celgene/ bluebird bio In-licensed Anti-cancer agent Research project - -
Juno Therapeutics/ Opus Bio
In-licensed CD22 cell therapy Phase I - -
Atara Biotherapeutics/ MSKCC In-licensed Anti-cancer agent Phase II - -
Ascend Bio/ Transgene In-licensed Oncolytic virus Phase II - -
Oxford BioMedica/ Novartis Out-licensed technology
T cell therapy Phase II - -
EvaluatePharma
Page 33 NYPF Meeting – 23 March 2015 © Defined Health
IPOs for Regenerative Platforms Now Common Across Development Stages
Company Class Highest Phase IPO Date Amount Raised by IPO ($MM)
Atara Biotherapeutics Cell therapy Phase II 10/16/2014 63.3
Bellicum Pharmaceuticals T cell therapy/Anti-GD2 cell therapy/Mesenchymal stem cell therapy
Phase II 12/18/2014 160.6
Bio-Matrix Scientific Group Cell therapy Preclinical 8/14/2014 -
Cardio3 BioSciences T cell therapy Phase I 6/20/2013 30.0
Juno Therapeutics Chimeric antigen receptor (CAR) T cell therapy/Anti-CD19 cell therapy/CD22 cell therapy
Phase II 12/19/2014 304.2
Kite Pharma Dendritic cell therapy/CAR T cell therapy/Anti-NY-ESO-1 T cell therapy
Phase II 6/20/2014 146.6
Lion Biotechnologies Cell therapy Phase II 9/26/2013 -
MabVax Therapeutics CAR T cell therapy Research 5/12/2014 -
TxCell Cell therapy Research 4/11/2014 22.4
Vascular Biogenics Gene therapy Phase II 10/1/2014 46.0
EvaluatePharma
Page 34 NYPF Meeting – 23 March 2015 © Defined Health
VCs Continue to be Very Active, Especially in Cell Therapies
Company Class Most Recent Financing Round
Financing Date
Investment ($MM)
Atara Biotherapeutics Cell therapy Series B 1/10/14 13.5
Bellicum Pharma T cell therapy/Anti-GD2 cell therapy/Mesenchymal stem cell therapy
Series C 8/27/2014 55
Cardio3 BioSciences T cell therapy PIPE 12/16/2013 3.4
Juno Therapeutics CAR T cell therapy/Anti-CD19 cell therapy/CD22 cell therapy
Series B 8/5/2014 134
Kite Pharma CAR T cell therapy/Anti-NY-ESO-1 T cell therapy Series A 5/15/2013 20
Lion Biotechnologies TIL Cell therapy PIPE 11/6/2013 23.3
MabVax Therapeutics CAR T cell therapy Series D 7/9/2014 3
Cellectis IL-2/Anti-CD19/Anti-BCMA/Anti-CD38/Anti-EgfrVIII CAR T cell therapy
PIPE 3/31/2014 28
Sorrento Therapeutics NK cell therapy PIPE 12/15/2014 -
Adaptimmune Anti-NY-ESO-1 T cell therapy Series A 9/25/2014 104
Cell Medica Stem cell therapy Series B 11/25/2014 80.4
Conkwest NK cell therapy, HER2 (ErbB-2) inhibitor, CD20 inhibitor,
Undisclosed 12/24/2014 50
EvaluatePharma
Page 35 NYPF Meeting – 23 March 2015 © Defined Health
Areas Outside of Oncology Continue to Lag in the Pipeline, Though Early Stage Interest Growing in CNS and Obesity
Thomson Reuters Cortellis, ADIS R&D Insight
0
1000
2000
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4000
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7000
8000
9000
Filed Phase III Phase II Phase I Preclinical Research
Nu
mb
er
of
Dru
gs
Number of Drugs in Development by Therapeutic Category
CVD Diabetes
Obesity CNS
Genito-Urinary Musculo-skeletal
Oncology Respiratory
Systematic Anti-infectives Others
Page 36 NYPF Meeting – 23 March 2015 © Defined Health
202015 Dealmaking Outlook 205 Dealmaking Outlook 2
2015 Dealmaking Outlook
SPEAKERS:
♦ Elaine Jones, PhD Executive Director, Venture Capital, Pfizer Venture Investments
♦ Alan Paau, MBA, PhD, CLP Chairman, Guangda Cooperation International Technology Center, Co. Ltd. (China); Former Vice Provost for Technology Commercialization - Global Initiatives Cornell University
♦ Jocelyn Trokenheim, Senior Director, Global Licensing and Business Development, Takeda Pharmaceuticals International
♦ Brianne Weingarten, Executive Director, Licensing & Business Development Alliance Management, Purdue Pharma L.P.
MODERATOR:
♦ Ed Saltzman, President & Founder, Defined Health
New York Pharma Forum March Program