Good question, bad optics

A report released by Goldman Sachs asks a question that the biotech industry has been starting to grapple with: “Is curing patients a sustainable business model?” It’s a fair question, and an easy answer: no. The GS analysts use another GS, Gilead Sciences, as a case study to explain this. A few years ago Gilead came out with their Hepatitis C cure, and US sales of that peaked in 2015 at about $12.5B. This year it’s projected to make less than $4B in the US. So the obvious conclusion is that curing patients with “one-shot” gene therapies makes less money over time than chronic therapies, makes sense. But jeeeeeeez when you take off your impartial industry analyst hat and think about how this kind of report looks to non-industry people… it’s just bad optics.

Massive fraud roundup

Theranos founder Elizabeth Holmes has settled the “massive fraud” charges levied against her by the SEC. A little refresher, Theranos was that company that was going to revolutionize the world of laboratory blood testing and then didn’t deliver. That sent Forbes’ evaluation of her to plummet from ~$4.5B to ~$0.0B, and brought a lot of scrutiny from federal agencies, which eventually culminated in this deal. As part of the stipulations, Holmes can no longer run Theranos, nor be an officer or director of a public company for 10 years.

Shout out to fellow massive fraud Martin Shkreli who was sentenced to 7 years in prison last week. We didn’t feel like giving the jerk a full story, but you’ll be happy to know he cried at his sentencing.

2. For the love of power and money

With every ending comes a new beginning. Sorry for the Hallmark introduction. The US Presidential election is over and whether you wore red, wore blue or were just plain wore out, it is over. But do you know what is not over? The rally in healthcare stocks, that’s what. Regardless of whether the rally is based on past perceptions or future projections, the facts are quite interesting. Between the start of the week and the time this article was written, the Dow Jones Industrial Average is +4.2%, the iShares NASDAQ Biotechnology Index (IBB) is +13.3%, and the NYSE Pharmaceutical Index (DRG) is +5.9%. Sooooo, there’s that.

3. Move over mAbs, stem cell therapies are (almost) here

Great news for individuals suffering from rheumatoid arthritis and not so great news for pharma companies holding patents on the monoclonal antibody-based biologics currently used to treat RA. An Australian biotech, Mesoblast, completed Phase II clinical trials on its stem cell treatment for rheumatoid arthritis to astounding results (some have inserted the word “cure” here). In a test designed to identify whether the stem cell treatment is efficient—by achieving 20% relief of signs and symptoms—researchers instead saw a 70% improvement among more than one-third of the patients who received MPC-300-IV. Since some RA patients are unable to take biologics, a stem cell therapy could benefit wider audiences.

5. Pfizer’s new pop-up manufacturing facility

Pfizer announced this past week that they are developing a Global Biotechnology Center in Hangzhou, China.  This $350M investment will be Pfizer’s newest addition to their portfolio of biotechnology centers and reinforces China as a leading area for growth in the healthcare space.  Integral to it all is GE Healthcare’s KUBio modular facility.  GE’s prefabricated modules reportedly cut the build time in half and help the facility reduce CO2, H2O and energy consumption by 75%.  Will these savings be reflected in the pricing of Pfizer’s future novel biologics and biosimilars?  That could help to lessen some of the recent shade thrown on pharma for its pricing strategies.  Not that it’s Pfizer’s responsibility to rescue the industry’s reputation but come on, it’s Pfizer.

5. Is Google’s biotech spinoff just science fiction?

A new report claims that Verily Life Sciences, the Google spinoff company responsible for things like glucose-monitoring contact lenses and a wristwatch-style cancer screener, may be more hype than reality. Stat, a healthcare news website owned by Boston Globe Media, published an investigative series reporting that three of Verily’s key projects are floundering. One former employee called the contact lenses “slideware,” a Silicon Valley term for something that doesn’t exist outside of a PowerPoint presentation. Verily defended its research, arguing that these projects take time because they’re “inherently difficult” and would like to remind everyone of another “slideware” project now called a self-driving car. “Science is easy,” said nobody, ever.