Cypress Bioscience, Inc. (NASDAQ: CYPB) was up $0.88 (35.2%) this morning on news that hedge fund Ramius has offered to buy the company for $4 a share, totaling approximately $154 million.
Cypress Bioscience, Inc. is a biopharma company that makes drugs for pain, rheumatology, and disorders such as fibromyalgia and rheumatoid arthritis.
Rigel Pharmaceuticals (NASDAQ: RIGL) may be the biotech winner this Tuesday. The company has signed a pact with AstraZeneca (NYSE: AZN) which could ultimately bring in about $1.25 billion if all targets are met. This pact is a licensing agreement for Rigel’s rheumatoid arthritis drug R788 or fostamatinib disodium.
Rigel said last year that its R788 significantly improved rheumatoid arthritis symptoms in patients in a phase II study and Rigel has been seeking a development partner to help finance phase III studies.
AstraZeneca will design a global phase III study for the RA drug and believes that the study will be initiated in the second half of this year. We will double-check the goal dates here because the new drug application target date appears to be 2013 for the FDA and European Medicines Agency.
AstraZeneca is making an upfront payment of $100 million as the first part of the pact. There is also an additional amount which can go up to an additional $345 million if certain milestones are achieved. But the big kicker here for Rigel comes in the form of up to an additional $800 million if specific sales are achieved as well as significant stepped double-digit royalties on global sales.
Rigel had a market cap of about $488 million based on a close of $9.43 on Friday. The company effectively has no sales and its September-2009 balance sheet lists approximately $156 million in cash and short-term investments with effectively no considerable long-term debt.
Rigel closed at $9.43 on Friday and we have shares trading up 6% at $10.00 ahead of the opening bell. Its shares have traded in a range of $4.19 to $14.75 over the last 52-weeks.
JON C. OGG
FEBRUARY 16, 2010
Pfizer Inc. (NYSE: PFE) is making a pipeline presentation today, and it is meant to address a serious and potentially severe issue affecting all Big Pharma companies from Merck & Co. (NYSE: MRK) after its Schering-Plough deal all the way down to where drug companies become biotech companies: That is the billions and billions of dollars that may disappear from profits as key drug patents expire in the coming years. This is also affecting Roche and companies like Novartis AG (NYSE: NVS) and GlaxoSmithKline plc (NYSE: GSK) on an international basis, which is why you have seen them make their own partnerships and acquisitions where possible.
Pfizer is giving a pipeline update showing its own efforts to address a whole new class of potential blockbuster drugs in the years ahead. Today’s pipeline update from Pfizer is the first real update since the company close the acquisition of Wyeth back in October, 2009.
The new development pipeline has potential drugs from both legacy companies. Pfizer is noting that this includes 133 programs from phase 1 studies through pipeline candidates in the registration process.
Pfizer is also noting that it has identified its six “Invest to Win” areas of research where there exist significant opportunities for innovation and market leadership. The new pipeline demonstrates focused investment in these areas of significant unmet medical need as well as growth in the critical technologies of vaccines and biologics. The six arena are as follows:
- Alzheimer’s disease;
- and diabetes.
The combined Pfizer-Wyeth pipeline had 600 projects ranging from discovery through registration, and the new portfolio is roughly 500 projects. Pfizer’s goal is to become a top-tier biotherapeutics company by 2015, meaning effectively that it wants to take over some of the dominance currently held in several areas by pure-play biotech companies. Its pipeline now includes a total of 6 vaccines and 27 biologics in development.
PML, or progressive multifocal leukoencephalopathy, is moving beyong TYSABRI as a side effect in the world of drugs and pharmaceuticals. Yesterday the FDA posted a ‘Dear Doctor letter’ from Genentech, now part of Roche (OTC: RHHBY). Unfortunately, this involves Biogen Idec, Inc. (NASDAQ: BIIB) as well. The two companies notified healthcare professionals about a third case of PML, the first case of PML in a patient with rheumatoid arthritis treated with Rituxan who has not previously received treatment with a TNF antagonist.
The companies noted that information to date suggests that patients with RA who receive Rituxan have an increased risk of PML and that doctors should consider PML in any patient being treated with Rituxan who presents with new onset neurologic manifestations.
You can read the full letter and explanations here. Unfortunately, PML risks are likely to come more front and center in the coming weeks and months.
It is worth noting that this is not the first of the potentially fatal side effects of Rituxan. There have been prior warnings of brain disorders and other warnings including cardiac arrest, reactivation of Hepatitis B, kidney failure, and more. And PML is already a noted risk in Rituxan.
It JON C. OGG