Healthcare Newsletter – June 2018

First Prosthetic Iris Approval by US FDA
Home-Health In a first of its kind approval this month, US FDA has approved the first artificial prosthetic iris – Customflex, developed by German firm HumanOptics AG. The Custom Flex artificial iris is astandalone prosthetic iris that will be used to treat aniridia,a complete or partial absence of irisas well as other congenital iris defects. It can also be used for other indications such as albinism, or surgical removal due to melanoma. The product is a thin flexible medical grade silicon disc which is implanted through a small incision in the eye, followed by surgical intervention to unfold the prosthesis. This CustomFlex Artificial Iris occupies the anatomical structures of the eye and is designed to mimic function of natural iris. It essentially creates an artificial pupil that reduces the amount of light entering the eye, thereby bringing significant clinical improvements in light-sensitivities associated with iris defects. A significant decrease in light sensitivity and glare was reported by about 70% of patients in the clinical trials. It also comes with an added cosmetic advantage as its size and color can be customized for each patient. Customflex is a permanent implant as against colored lenses which is the current standard of care, thus providing a one-time solution to the problem.

Biosimilars –Biocon-Mylan’s USFDA approval & Japanese partnerships
Home-HealthMylan has baggedUS FDA approval for Fulphila, a biosimilar version of Neulasta (pegfilgrastim), co-developed with Biocon. Despite being a first generation asset, Fulphila is the first biosimilar approved for Amgen’s novel biologic Neulasta, and not for lack of effort. Other candidates from Sandoz and Coherus, as well as Fulphila have been shot down by FDA for different reasons in the past, thus making this a much awaited approval in the context ofexpanding patient access. According to IQVIA, Neulasta clocked sales of USD 4.2 billion for the 12 months ending March 31, 2018.This approval reflects strong commitment by Mylan and Biocon in advancing their biosimilar portfolio. Fulphila is the second successful product from Mylan- Biocon partnership in the US, afterOgivri (trastuzumab) approval last year. Mylan will exclusively commercialize the product in U.S., Canada, Japan, Australia, and New Zealand and the European Union while Biocon-Mylan will co-exclusively serve the RoW market.This more affordable alternative to Neulasta is also indicated to reduce the duration of febrile neutropenia in patients treated with chemotherapy in certain types of cancer.

In another recent biosimilar activity,Mumbai based Lupin pharma and Japan’sNichi-Iko have forgeda partnership for distribution, promotion and sale of biosimilar Etanercept in Japan. Lupin’s Japanese arm and Yoshindo co-developed this biosimilar under the joint venture YL biologics. Nichi-iko is seeking approval from Japanese regulator Pharmaceuticals and Medical Devices Agency (PMDA) for launching the product. This reflects the trend of global biosimilar companies seeking local JV partners for development and marketing of their products in Japan. Notable examples include Celltrion’s marketing partnership with Nippon Kayaku, the Dong-A ST and Meiji Seika Pharma joint venture and Biocon’s partnership with FUJIFILM Pharm for insulin glargine. While Japan has been a relatively less attractive market for small molecule generics companies, the intensity of biosimilar partnerships reflects significantly higher potential in biosimilars.

Inorganic Growth & Strategic Consolidation in Pharma Contract Services
Interests Spike In line with the aggressive M&A landscape in mainstream pharma business, the CDMO services sector has also been rife with capacity expansion activities from industry majors. Swedish firm Recipharm AB has been a front-runner in seeking inorganic growth through facility as well as business acquisitions. Continuing its strategy of driving growth through addition of new capabilities and expanding geographic reach, Recipharm has finalized the deal with Sanofi to buy its contract inhalation drug business and plant in the U.K. this month. As part of the transaction, Recipharm is set to pay USD 60 Million to Sanofi for the 125,000 square meter plant in Manchester with 450 employees. The site is equipped to manufacture metered-dose inhalers and nasal sprays for contract clients targeting treatment areas such as asthma and chronic obstructive pulmonary disease (COPD). The company struck a similar deal in 2016, by acquiring Kemwell’s pharmaceutical contract development and manufacturing operations in US, Sweden and India. Recipharm has also been streamlining its business through strategic addition and closure of plants in last few years. Last year Recipharm announced closure of its tablet plant in Stockholm and sachet & stick pack filling facility in Hoganas. Similarly Recipharm also struck a deal with Roche to take over its solid-dose products plant in Spain, near Madrid.
Perpetuating Momentum in CAR-T cell Therapies
Private Vaccines Market in India Considering Chimeric antigen T-cell therapy (CAR-T) is a recent novel development in cancer treatment, the level of industry activity in the space is astounding. The beginning of the year witnessed Celgene becoming an active contender in the space through acquisition of Juno Therapeutics for a staggering USD 9 billion to gain 100% of the rights to its CAR-T program. With its recently announced six-month safety and efficacy data from the open-label, multicenter phase I study, TRANSCEND (NHL-001) Celgene’s candidate JCAR017 (lisocabtagene maraleucel ;liso-cel), upon approval, would be the third market entrant in the space. Study has shown better efficacy results with 46% of the patients showing complete response and 49% of the patients experiencing overall response in patients with relapsed/refractory aggressive B-cell non-Hodgkin lymphoma (NHL).JCAR017 has also shown better safety profile against complications such as severe cytokine release syndrome with 1% rate and 13% rate of severe neurotoxicity.
Novartis’ Kymriah and Gilead Sciences’ Yescarta are currently approved chimeric antigen T-cell receptor (CAR-T) therapies by the FDA. With overlapping indications such as diffuse large B cell lymphoma (DLBCL), some level of head-on competition between products is inevitable. While intensifying competition usually signals price optimization and expansion of access to care, insuch high value therapies targeting rare indications, it could potentially be a threat to return on investment if accessible patient pool is limited. While we continue to be excited about expanding possibilities with this new paradigm of care,it is pertinent that business and pricing models evolve to ensure sustainability.

Serum Institute & Sanofi pushing boundaries in infectious disease vaccines with significant technology partnerships
Home-Health Despite several setbacks from last year including the losses associated with Dengvaxia, global vaccine giant Sanofi Pasteur continues to take active strides in the vaccines segment. The company has struck a partnership deal with clinical stage company Translate Bio to develop mRNA vaccines for up to five undisclosed infectious disease pathogens.Sanofi has agreed to absorb all R&D costs in return for worldwide marketing rights for the vaccines. As part of the deal, Translate Bio is entitled to receive USD 45 Million upfront and USD 760 million in milestone payments associated with development, regulatory filings and sales. Sanofi also has an option to exercise development of vaccines for other pathogens which will result in additional fees. Equipped with a strong partnership, Translate Bio is also preparing for its IPO worth USD 115 Million in parallel. This is a significant development considering that the mRNA technology has until now been largely explored for higher value rare disease or oncology applications and not extensively for infectious disease vaccines.

Besides focusing on accessingnovel platforms for vaccine development, vaccine majors are also directing attention to innovative delivery technologies. Netherland based R&D organization developing innovative vaccine platforms, Intravacc has partnered with Indian vaccine major Serum Institute of India to co-develop novel vaccine delivery system called Bioneedles that are administered under the skin with an applicator. The freeze-dried vaccine is delivered upon degradation of the bioneedle matrix which is a biomaterial made of starch like polymer.This minuscule biodegradable mini implant will be developed for measles and rubella vaccines and are freeze and heat-stable enabling cold chain free transportation.

Strategic Partnerships remain Crucial in the booming Health Tech Space
Home-Health Health Techcompanies continues to soar up the commercial ladder, with growing emphasis onconnected health. In the crowded healthcare technology landscape, particularly in consumer focused apps, companies are increasingly considering integration with hardware partners to accelerate scale-up and consumer reach. Samsung has announced partnership with UK based digital health start-up Babylon. Samsung will sell its new devices pre-installed with Babylon’s health app featuring the service called ‘Ask an Expert, powered by Babylon’.The app will allow users to check their symptoms and have a conversation with doctors over video conferencing. This is the second partnership deal executed by Babylon, the previous one being with the Chinese app giant Tencent to deliver telehealth services through the WeChat messaging app. While Samsung envisions growth potential in AI and digital health, Nokia has decided to divest from the digital health business. Nokia Technologies made announcement last month to sale off its digital health products back to French wearables company Withings.

Sathguru Management Consultants acted as sole transaction advisor to Danlaw Technologies on its acquisition of Titan Time Products Ltd

Article for Business of Agriculture – July August 2018 Edition

“India Needs To Build Awareness Around One Health”

Mandates – Ongoing Assignments and Partnering Opportunities

1. Brand Divestiture for a leading Indian cardiac brand
2. Outlicensing – liposomal, microsphere and nano-particle based complex generics from a leading Latin American company
3. Market Landscaping & Business Plan for Lab Animal breeding facility
4. Lung cancer incidence mapping & access model for biotech venture
5. India opportunity assessment & market access plan for critical care medical device
6. Valuation of API company for strategic investment
7. Technology scouting & licensing for prioritized vaccines
8. Handholding strategic collaborations for leading opthalmic institution
9. Private equity fund raising – leading Indian diagnostic company
10. Sell-side mandate for upcoming 200+ bed hospital in Tirupati

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