Big Pharma shake up reveals how R&D is changing for mid level pipeline drug advances

Why are pharmaceuticals so expensive.  New drugs go through a treacherous path to the market place, not just in terms of biochemical science, but also in deep pocket financing.  Prior to their release on the market with approval by the FDA, enormous sums of capital must be available to do the science of development.

It is enough of a task that places pharmaceutical companies at financial risk.  These two articles are a slice of financial vehicles which permit research to proceed.

Lilly puts two-thirds of midphase cancer pipeline up for sale in major shake-up of R&D

Eli Lilly is seeking partners for two-thirds of its midphase oncology compounds. The Big Pharma wants to offload six phase 2 candidates to focus its R&D dollars on a clutch of early to midstage assets it thinks can become the new standard of care.

Lilly is prioritizing the development of seven candidates, although one—breast cancer drug abemaciclib—is already in front of the FDA. Two of the remaining six are in phase 2, while the rest are yet to get out of phase 1. The list includes a PD-L1 antibody and PI3K/mTOR dual inhibitor Lilly is developing for use in combinations. And the small-molecule Chk-1 inhibitor it picked up from Array BioPharma.

Lilly faced increasing demands for financing of several phase I, II, and III drugs forcing to seek additional funds or partners.  The decision to cull half of the cancer pipeline coincided with a setback for Lilly’s baricitinib. The Incyte-partnered rheumatoid arthritis drug was due to come to market this year. But a demand by FDA for another study to allay its concerns about the incidence of blood clots looks set to push back the timeline by 18 months or more. That bodes badly for Lilly.

Lilly lists 10 assets in its partnered pipeline, the same number as are in its top and second-tier priority pipelines. Three of the phase 1 partnered assets are already owned by third parties. But the remaining seven—including six in phase 2—are yet to be the subject of outlicensing deals.

The seven drugs seeking new homes are:

• Galunisertib, a small molecule inhibitor of TGF beta R1 kinase  
• Ralimetinib, a p38 MAP kinase inhibitor
• Emibetuzumab, a MET antibody
• A notch Inhibitor 
• A FGFR inhibitor 
• A CXCR4 peptide antagonist
• A FGFR-3 antibody-drug conjugate

The pace at which new classes of drugs often exceeds and causes pharmaceutical companies to shift and change priorities in mid-cycle of drug development.

The same can be said for medical device companies

LivaNova puts for sale sign on $250M cardiac rhythm unit

LivaNova PLC is a global medical technology company built on nearly five decades of experience and a relentless commitment to improve the lives of patients around the world. LivaNova’s advanced technologies and breakthrough treatments provide meaningful solutions for the benefit of patients, healthcare professionals and healthcare systems. Headquartered in London and with a presence in more than 100 countries worldwide, the company employs more than 4,500 employees. LivaNova operates as three business franchises: Cardiac Surgery, Neuromodulation and Cardiac Rhythm Management, with operating headquarters in Mirandola (Italy), Houston (U.S.A.) and Clamart (France), respectively

LivaNova is exploring strategic options for its cardiac rhythm management (CRM) business. The medtech company decided to look to offload the $250 million-a-year pacemaker and defibrillator unit after concluding it no longer fits with its strategy.

CRM is one of three units at LivaNova, the others being cardiac surgery and neuromodulation, and last year accounted for about one-fifth of its sales. Products including high-voltage defibrillators, cardiac resynchronization therapy devices and low-voltage pacemakers generated those sales. But while CRM is competitive in some niches, notably in Europe and Japan, LivaNova thinks its best option is to part ways with the business.

LivaNova itself is the product of a merger between Sorin and Cyberonics in 2015/

The decisions are multi-factorial:

“The CRM business franchise is a global business and strong regional player with attractive assets, a robust pipeline and growth potential,” LivaNova CEO Damien McDonald said in a statement. “However, it is no longer a strategic fit within LivaNova’s portfolio.” “The single biggest decision and discussion point for us around capital allocation is how we create shareholder value with the CRM portfolio. It's top of mind for the leadership team, and we're continuing to work on that,”  CRM sales fell 6% over the first six months of 2017. LivaNova attributed the decline to a dropoff in sales of implantable cardiac defibrillators as compared to a period in which it introduced a new product, as well as unfavorable foreign currency exchange rate fluctuations.