Pharma shooting for the moon?

By MaverickNY on July 25, 2009

Given the recent glut of Pharma companies snapping up baby biotechs, you could well be wondering if some of them are betting the farm on the last roll of the dice or shooting for the moon like Apollo 11.

It's a crapshoot though, as R&D offers no guarantees as the growing list of drugs failing in Phase III development over the last 12 months shows.

Is desperation starting to set in or should we be thinking that Pharma is now moving to Las Vegas from New Jersey?

Think about it, BMS already had the licensing rights to Medarex's ipilimumab, so why bother buying the company? Perhaps they thought the stock would rise or that the pipeline of autoimmune or cancer drugs in phase I was so compelling?

The Daily Finance had a useful perspective:

"On paper, Medarex is not much of a company. It had revenue of $10
million in the March quarter and lost $47 million. The firm's
attraction is in its future. Bristol is paying a remarkably high price
for that future and there is no guarantee that the risk will pay off.
But big pharma does not have much of a future without new drug
pipelines, so it will pay for what it does not have."

Indeed, but one wonders how MedImmune and AstraZeneca are feeling right now, as they have the co-promotion option on Medarex's MEDI-545 and MEDI-546, which target the anti-IFNα Pathway in lupus and other autoimmune diseases.

Ilaris, another Medarex compound, was recently approved by the FDA for cryopyrin associated periodic syndromes including Muckle-Wells syndrome. It is codeveloped and promoted by Novartis. There are several others in a similar situation including Centocor/Ortho Biotech (Stelara and Simponi), GSK/Genmab (ofatumumab), which was recently filed for FDA approval in CLL and the drug also appears to have activity in rheumatoid arthritis. There are several other deals for earlier compounds with Merck, Genmab and Pharmathene.

So if the BMS purchase of Medarex goes through, I wonder what will happen with the existing co-promotion deals? Do BMS cancel them and take them on themselves, or honour the agreements and bank the revenues?

It should be an interesting to see what evolves from the deal one way or the other as we sit by the river watching the boats and debris float by.

Photo Source: Life