FDA released pre-draft guidance on Thursday proposing a risk-based framework for regulating laboratory-developed diagnostic tests (LDTs). Under the proposed scheme, FDA would classify LDTs as low-, moderate- or high-risk based on the existing medical device classification system. Low-risk (Class I) LDTs would not be subject to premarket review, while moderate- (Class II) and high-risk (Class III) tests would require regulatory submissions. In 18 months, the agency plans to publish draft guidance to clarify the classification scheme.
The premarket review of LDTs would be phased in over the next nine years beginning with the highest-risk devices, which FDA defines as LDTs that have the same intended use as an FDA-approved companion diagnostic or an FDA-approved Class III medical device, as well as certain LDTs for determining the safety or efficacy of blood products. Twelve months after FDA publishes the final guidance, manufacturers and laboratories must submit PMAs to FDA for the highest-risk tests. The agency said it would exercise enforcement discretion while the PMA is under FDA review so as to not disrupt patient access.
Clinical validity has already been established for many LDTs, and the agency would not require additional clinical studies for those, said Jeffrey Shuren, director of FDA's Center for Devices and Radiological Health, in a press conference. FDA would continue to exercise enforcement discretion for low-risk LDTs, LDTs for rare diseases and those for which there is no FDA-approved test, he said.
Currently, in vitro diagnostics are subject to both FDA device regulations and CLIA requirements, while LDTs are not subject to FDA review. In the pre-draft guidance, FDA said CLIA requirements only provide assurances for the quality of laboratory practices, and they lack independent review for clinical validity of a test and postmarket safety monitoring. The American Clinical Laboratory Association (ACLA) said in a statement that the proposed regulation "could stifle diagnostic innovation and ultimately jeopardize patient access to timely and effective treatments."
Rep. Michael Burgess (D-Texas) said in a statement that FDA's pre-draft guidance is "redundant, will stifle innovation and will require additional taxpayer funding," and that FDA's agency jurisdiction over LDTs "has never been legally clarified."
The guidance had been tied up in the White House Office of Management and Budget for at least 18 months. Earlier this month, a group of Democratic senators called for the release of FDA's guidance, while a group of academic laboratories urged against it (see BioCentury Extra, July 17).
FDA released the pre-draft guidance to fulfill a requirement under the Food and Drug Administration Safety and Innovation Act, which requires the agency to notify Congress 60 days prior to publishing draft guidance on LDT regulation. FDA will not publish the draft or open a public docket for at least 60 days.
Separately, FDA published final guidance on the development of in vitro companion diagnostics. The guidance is in line with draft guidance published in 2011. To date, FDA has approved 18 companion diagnostics (see BioCentury Extra, July 12, 2011).
Catalent Inc. (NYSE:CTLT) raised $871.3 million through the sale of 42.5 million shares at $20.50 in an IPO on the NYSE. The price values the company at $2.4 billion. Earlier this month, the company amended the offering to sell the same number of shares at $19-$22. Catalent filed to raise up to $100 million in the offering in January. Morgan Stanley; JPMorgan; BofA Merrill Lynch; Goldman Sachs; Jefferies; Deutsche Bank; Blackstone Capital Markets; Piper Jaffray; Raymond James; Wells Fargo Securities; William Blair; and Evercore are underwriters.
Catalent provides delivery technologies -- including oral, injectable and respiratory delivery technologies -- for drugs, biologics and consumer health products. For the fiscal year ended June 30, Catalent reported $1.8 billion in revenues. The company was created in April 2007 when private equity firm Blackstone Group acquired the pharmaceutical technologies and services segment of Cardinal Health Inc. (NYSE:CAH).
On its first day of trading Thursday, Catalent was off $0.51 to $19.99.
Ophthalmic gene therapy play Avalanche Biotechnologies Inc. (NASDAQ:AAVL) jumped $10.99 (65%) to $27.09 on its first day of trading Thursday after raising $103 million through the sale of 6 million shares at $17 in an IPO. Earlier this month, Avalanche said it planned to sell 5.4 million shares at $13-$15. The $17 price valued the company at $363.4 million; with Thursday's move, the company is now valued at $579.1 million. Jefferies; Cowen; Piper Jaffray; and William Blair are underwriters.
Avalanche plans to report Phase IIa data of AVA-101 to treat wet age-related macular degeneration (AMD) in mid-2015, with a Phase IIb trial to start in 2H15. AVA-101 is an adeno-associated virus (AAV) vector-based therapy that delivers soluble vascular endothelial growth factor (VEGF) receptor 1 (sFLT1; sVEGFR-1), a VEGF inhibitor.
Bio Blast Pharma Ltd. (NASDAQ:ORPN), Marinus Pharmaceuticals Inc. (NASDAQ:MRNS) and Vascular Biogenics Ltd. (dba VBL Therapeutics Ltd.) (NASDAQ:VBLX) all took haircuts in IPOs on NASDAQ on Thursday. Bio Blast raised $35.2 million through the sale of 3.2 million shares at $11. The price values the company at $156.5 million. Earlier this month, the company amended the offering to sell 3.3 million shares at $11-$13. At the $12 midpoint, the company would have raised $40 million and been valued at $172.4 million. Oppenheimer; Roth Capital Partners; and BTIG are underwriters.
Bio Blast's Cabaletta is in the Phase II/III HOPEMD trial to treat oculopharyngeal muscular dystrophy (OPMD), an inherited disorder caused by a mutation in poly(A) binding protein nuclear 1 (PABPN1; PABP2) that is characterized by difficulty swallowing and the loss of muscular strength and weakness. Cabaletta is an IV formulation of trehalose that Bio Blast said enables therapeutic doses of the compound to reach muscles. Trehalose is a disaccharide that prevents pathological aggregation of proteins in cells. Bio Blast dropped $2.60 (24%) to $8.40 on Thursday.
Although Marinus bumped up its number of shares sold compared to its proposed number, the company priced well below its proposed range. The company raised $45 million through the sale of 5.6 million shares at $8, which values the company at $110.9 million. Earlier this month, Marinus amended the offering to sell 4 million shares at $12-$14. At the $13 midpoint, the company would have raised $52 million and been valued at $159 million. Marinus filed to raise up to $63.3 million in the offering in May. Stifel; JMP Securities; Oppenheimer; and Janney Montgomery Scott are underwriters. Marinus' ganaxolone is in a Phase IIb trial as adjunctive therapy for partial onset seizures; it is also in a Phase II trial to treat behavioral symptoms associated with fragile X syndrome. The compound is a synthetic neurosteroid and derivative of allopregnanolone, a GABA A neuromodulator. Marinus was unchanged at $8 on Thursday.
VBL raised $64.8 million, but also priced below its proposed range. The company sold 5.4 million shares at $12, which values the company at $222.5 million. Earlier this month, the company amended the offering to sell 5.4 million shares at $13-$15. At the $14 midpoint, the company would have raised $75.6 million and been valued at $259.5 million. Deutsche Bank; Wells Fargo; JMP Securities; Needham; and Oppenheimer are underwriters. The company's VB-111 is in Phase II testing to treat recurrent glioblastoma. VBL plans to start Phase III testing of the gene-based dual anti-angiogenic and vascular disruptive agent (VDA) in 1Q15. On Thursday, VBL was off $1.75 (15%) to $10.25.
Venrock closed its seventh fund with $450 million. The firm, which invests in public and private healthcare and technology companies, closed its sixth fund in 2010 with $350 million. Venrock's current healthcare portfolio includes cancer play Juno Therapeutics Inc. (Seattle, Wash.) and Avalanche Biotechnologies Inc. (NASDAQ:AAVL), which raised $103 million in an IPO on Thursday (see above).
AstraZeneca plc (LSE:AZN; NYSE:AZN) disclosed in its 2Q14 financial results on Thursday that FDA extended the PDUFA date by three months for cancer product olaparib. The PDUFA date is now Jan. 3, 2015; the previous date was Oct. 3. According to AZ, FDA is reviewing additional data the company submitted. AZ is seeking accelerated approval of the poly(ADP-ribose) polymerase (PARP) inhibitor as maintenance treatment of platinum-sensitive relapsed ovarian cancer in patients with germline breast cancer early onset (BRCA) mutations who are responding to platinum-based chemotherapy.
Last month, FDA's Oncologic Drugs Advisory Committee voted 11-2 that safety and efficacy data did not support accelerated approval of olaparib and that the agency should delay considering approval until results are available from an ongoing confirmatory Phase III trial (see BioCentury, June 30).
AstraZeneca's second quarter revenues were $6.5 billion, beating the Street's estimate of $6.24 billion and up from $6.23 billion in 2Q13. Core EPS was $1.30, up from $1.20 in the prior year's quarter and above the Street's estimate of $1.09. The pharma also raised its 2014 revenue and core EPS guidance. AZ now expects full-year revenues to be in line with 2013 and core EPS to decrease in the low double-digits. The pharma previously expected low-to-mid single digit percentage decline in revenue and a percentage decline in core EPS in the teens due to a generic launch of Nexium esomeprazole. The guidance assumes constant exchange rates.
Teva Pharmaceutical Industries Ltd. (NYSE:TEVA) reported 2Q14 earnings and raised its 2014 EPS guidance on Thursday. The specialty pharma and generics company reported non-GAAP diluted EPS of $1.23, beating by a penny the Street's $1.22 estimate and up from $1.20 in 2Q13. Revenues in the quarter were $5.05 billion, missing the Street's $5.09 billion estimate but up from $4.9 billion in the prior year's quarter.
Teva said it now expects 2014 adjusted diluted EPS of $4.50-$4.80, assuming the U.S. launch of generic competitors to multiple sclerosis drug Copaxone glatiramer in August. Without Copaxone generics in 2014, Teva expects EPS of $4.90-$5.10. The company previously expected EPS of $4.20-$4.50 assuming the U.S. launch of generic versions of Copaxone on June 1, and EPS of $4.80-$5.10 in the exclusive Copaxone scenario.
Teva said the U.S. Supreme Court is set to hear an appeal on Oct. 15 by Teva of an appeals court decision that ended exclusivity for Copaxone on May 24; the appeals court invalidated a process patent for Copaxone that was set to expire on Sept. 1, 2015. The company said it expects a decision on the appeal by late this fall or early next year (see BioCentury Extra, April 21).
Teva was off $1.38 to $53.50 on Thursday.
Valeant Pharmaceuticals International Inc. (TSX:VRX;NYSE:VRX) fell $8.44 to $117.39 in New York and C$9.50 to C$127.92 in Toronto after reporting 2Q14 financial results on Thursday and lowering its full-year EPS and revenue guidance. The company now expects diluted non-GAAP EPS of $7.90-$8.10 on revenues of $8-$8.3 billion, down from its previous guidance of $8.55-$8.80 in EPS on revenues of $8.3-$8.7 billion. The Street was expecting EPS of $8.61 on revenues of $8.4 billion. Second quarter revenue was $2.04 billion, slightly below the Street's $2.05 billion estimate and up 86% from $1.1 billion in 2Q13. Valeant reported diluted non-GAAP EPS of $1.91 for 2Q14, missing the Street's $1.96 estimate but up from $1.34 in the prior year's quarter.
On the earnings call, Valeant also gave an update on its hostile bid for Allergan Inc. (NYSE:AGN) and said it expects Allergan shareholders to request a special meeting in August to remove six of Allergan's nine directors. Valeant launched the hostile tender offer last month after Allergan's board rejected two prior bids (see BioCentury Extra, June 18).
EyeGate Pharmaceuticals Inc. (Waltham, Mass.) filed to raise up to $28.8 million in an IPO on NASDAQ underwritten by Aegis. Last year, the company reported that transscleral iontophoresis delivery of EGP-437 met the primary endpoint of non-inferiority to standard of care in a Phase III trial to treat non-infectious anterior segment uveitis. EGP-437 was non-inferior to daily prednisolone acetate 1% ophthalmic suspension in patients achieving a complete response. This half, EyeGate plans to start a second pivotal trial of the dexamethasone phosphate ophthalmic solution delivered by the EyeGate II Ocular Drug Delivery System. The company expects to complete the trial in 1H16 (see BioCentury Extra, April 9, 2013).
Taiho Pharmaceutical Co. Ltd. (Tokyo, Japan) discontinued the 889-patient Phase III ORIENTAL trial evaluating orantinib (TSU-68) plus transcatheter arterial chemoembolization (TACE) to treat unresectable hepatocellular carcinoma (HCC). The move came after an interim analysis by an independent DMC showed orantinib plus TACE did not meet the "pre-determined standard related to the primary endpoint" of improving overall survival (OS) vs. placebo plus TACE. Orantinib is an oral small molecule inhibitor of multiple receptor tyrosine kinases. Taiho, a subsidiary of Otsuka Holdings Co. Ltd. (Tokyo:4578), could not be reached for details or next steps for orantinib.
GlaxoSmithKline plc (LSE:GSK; NYSE:GSK) and Genmab A/S (CSE:GEN; OTCBB:GMXAY) said an interim analysis by an independent DMC showed Arzerra ofatumumab as maintenance treatment in patients with relapsed chronic lymphocytic leukemia (CLL) responding to induction therapy met the primary endpoint of improving progression-free survival (PFS) vs. no further treatment (observation) in the Phase III PROLONG (OMB 112517) trial. The pre-defined threshold for significance on the endpoint was p<=0.001. GlaxoSmithKline said it plans to share the results with regulatory agencies to evaluate the potential for future regulatory applications, but could not be reached for details.
Arzerra is approved in the U.S. and EU to treat CLL refractory to fludarabine and alemtuzumab and as first-line treatment of CLL. GSK has worldwide co-development and commercialization rights to the human mAb against CD20 from Genmab, which was off DKK1.50 to DKK223.30 on Thursday. The news came after market close in Denmark.
Novartis AG (NYSE:NVS; SIX:NOVN) is acquiring GSK's portfolio of marketed cancer drugs, which includes Arzerra, as part of a pair of multi-billion dollar deals slated to close next half (see BioCentury, April 28).
Novartis AG (NYSE:NVS; SIX:NOVN) said once-daily oral KAE609 for three days led to a median parasite clearance time, the primary endpoint, of 12 hours in an open-label Phase II trial to treat malaria. The Thai trial enrolled 21 adults with uncomplicated Plasmodium vivax or P. falciparum malaria, including patients with resistant infections. The trial was conducted in collaboration with The Wellcome Trust-Mahidol University-Oxford Tropical Medicine Research Programme. Data were published in the New England Journal of Medicine.
Novartis said Phase IIb trials with KAE609 are being planned, but the pharma did not provide a time frame on when the trials are slated to start in time for publication. KAE609 is a synthetic spiroindolone analog.
In 2010, a team of researchers led by the Novartis Institute for Tropical Diseases published a paper in Nature detailing spiroindolone-based anti-malarial compounds with activity against drug-resistant P. falciparum (see SciBX: Science Business eXchange, Oct. 7, 2010).
Specialty pharma company Meda AB (SSE:MEDAA) will acquire Rottapharm Madaus Group (Monza, Italy) for SEK21.2 billion ($3.1 billion) in a deal slated to close next quarter. The offer comprises SEK15.3 billion ($2.2 billion) in cash up front; 30 million Meda shares valued at SEK3.2 billion ($468.3 million) based on Meda's close of SEK106.40 on Wednesday, before the deal was announced; and a SEK2.6 billion ($381.4 million) non-contingent milestone payment in January 2017. Meda also will assume SEK2.8 billion ($410.8 million) in Rottapharm debt.
Meda markets specialty products along with OTC drugs and branded generics. Rottapharm markets OTC and unbranded consumer healthcare drugs. Meda said the combined company would have 2013 pro-forma revenues of about SEK18 billion ($2.6 billion).
In April, Meda's board rejected a bid from generics company Mylan Inc. (NASDAQ:MYL) to "combine the two businesses" (see BioCentury Extra, April 4).
Meda was up SEK4.90 to SEK111.30 on Thursday.
FDA approved Striverdi Respimat olodaterol from Boehringer Ingelheim GmbH (Ingelheim, Germany) to treat airflow limitations in patients with chronic obstructive pulmonary disease (COPD). Boehringer said it plans to launch the product -- a long-acting beta 2 agonist (LABA) delivered via Boehringer's Respimat Soft Mist Inhaler -- in the U.S. "as soon as possible." The product is approved in the U.K., the Netherlands, Denmark, Iceland, Canada and Russia as maintenance treatment for COPD.
FDA's Blood Products Advisory Committee voted 15-1 on Thursday that HyQvia from Baxter International Inc. (NYSE:BAX) has a favorable risk-benefit profile. The product is under review as replacement therapy to treat adults with primary immunodeficiency associated with defects in humoral immunity. Baxter expects a decision this quarter, but the PDUFA date is undisclosed. HyQvia is a subcutaneous formulation of Gammagard, an IgG antibodies plasma-based therapy, and recombinant human PH20 hyaluronidase (rHuPH20) from Halozyme Therapeutics Inc. (NASDAQ:HALO). Halozyme was up $0.51 to $9.74 on Thursday.
Sen. Tom Carper (D-Del.) introduced a bill in the U.S. Senate that would increase and make permanent the alternative simplified R&D tax credit. The bill, S. 2715, would increase the tax credit to 25% from the 14% credit that expired last year. The bill would also enable CROs to claim a portion of the credit.
Earlier this year, the Senate was short of the votes needed to advance a bill that would have extended the credit to 2015 (see BioCentury Extra, May 15).
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