Gilead'S US $21 Billion Addition Of Antibody Coupled Drugs In The Field Of Cancer

In September, the global pharmaceutical market experienced the biggest downturn in September.

Gilead science and immunomedics announced that the two companies have reached a final merger agreement. Under the agreement, Gilead will buy immunomedics for $88 A share in cash, which is 108% higher than the closing price of immunomedics on September 11, 2020, with a transaction volume of about $21 billion.

The deal, which was unanimously approved by Gilead and immunomedics boards, is expected to be completed in the fourth quarter of 2020. The offer, which is not subject to financing conditions, will be made with about $15 billion in cash on hand and about $6 billion in new debt issues.

This means that Gilead, an anti-virus giant, has added another "big player" in the field of cancer in recent years. Gilead will obtain antibody drug conjugate (ADC) trodelvy (sacituzumab govitecam hziy) in the hands of immunomedics, which is considered as a base stone drug in tumor product line.

The deal is another big investment this year after Siemens's US $16.4 billion acquisition of Varian, adding new color to the "mediocre" global medical M & A in 2020.

Platoon layout in cancer field

The large-scale merger and acquisition is Gilead's acquisition of kit Pharma, car-t company, with us $11.9 billion in 2017, the acquisition of tumor immune company Fort seven with us $4.9 billion in early March 2020, the 10-year long-term cooperation of US $2 billion with acrus Biosciences in May, the acquisition of 49.9% equity of pianyr with us $275 million in June, and the acquisition of Tizona by US $300 million in July After a series of actions, such as 49.9% equity and other large and small actions, the company once again set out to lay out the field of cancer treatment.

In the investor conference call, Gilead said that in the past two years, it has reached a number of transactions and cooperation with 13 external innovative pharmaceutical enterprises, involving a total transaction amount of more than 40 billion US dollars.

The most important drug acquired by Gilead this time is trodelvy (sacituzumab govitecan hziy), which is the first Trop-2 targeted antibody coupling drug.

Trodelvy received accelerated approval from the U.S. Food and Drug Administration (FDA) in April to treat adult patients with metastatic triple negative breast cancer (mtnbc) who have previously received at least two treatments. Immunomedics also plans to submit a supplementary biological agent license application (BLA) in the fourth quarter of this year to support trotrotrovy's full approval, and is expected to be approved in Europe in the first half of 2021.

Triple negative breast cancer accounts for about 15% to 20% of all breast cancer cases and is generally considered to be the most aggressive breast cancer. HR + / HER2 - breast cancer accounts for more than 70% of all breast cancers.

In addition to mtnbc, trodelvy is also conducting a phase 3 clinical trial for third line HR + / HER2 breast cancer and a phase 2 clinical study for bladder cancer. Other ongoing studies are evaluating its potential as a treatment for non-small cell lung cancer and other solid tumor types.

With such a large acquisition, trodelvy is regarded as the cornerstone drug in the field of cancer by Gilead: "based on the existing marketed products and advanced clinical candidates of kit and Gilead for patients with hematological malignancies, including yescarta, tecartus and magrolimab, we will bring Gilead a cornerstone product to expand and deepen its solid tumor product line."

In addition to hepatitis B, hepatitis C, HIV and other antiviral drugs, cancer is the more important investment direction of Gilead at present. Especially after the sales of hepatitis C drug portfolio has been continuously declining, the new drug portfolio has become an increasingly important part of its future performance growth.

According to Gilead's latest results for the second quarter and the first half of 2020, the total revenue in the second quarter and the first half of 2020 will be US $5.1 billion and US $10.7 billion respectively, which are both down compared with us $5.7 billion and US $11.0 billion in the same period of 2019. Gilead said that one of the main reasons for the decline was due to the epidemic situation, the decrease in sales of chronic hepatitis C virus products, and the decrease of medical treatment and screening.

On September 14, Qu Rong, general manager of Dongfang Gaosheng Shenzhen company, said in an interview with reporters, "for Gilead, the liver disease market is shrinking sharply, and new pipelines are urgently needed. Tumor is its key area, and its advantage lies in the rich cash reserves accumulated by hepatitis C drugs. Trodelvy has been approved by the FDA to trade money for time and space. As a small and medium-sized biopharmaceutical company, the merger and acquisition of immunomedics by large pharmaceutical enterprises is the main way out, especially the high-value M & A by Gilead, which is definitely a very good opportunity to exit. "

Gilead expects the acquisition to accelerate revenue and earnings per share growth: trodelvy has huge business potential in mtnbc and other solid tumors. In addition to accelerating Gilead's revenue growth immediately, the acquisition is expected to generate a neutral growth in Gilead's non GAAP earnings per share in 2023, followed by significant growth thereafter.

"Gilead has deployed car-t, CD47, Trop-2, CCR8, JAK, PD-1, etc. in the field of cancer, focusing on tumor immunity and emerging technologies such as car-tadc, there is a great space for imagination and opportunities for collaborative use." Qu Rong believes that although the cost is relatively large, the selected targets are the most advanced in the field. The former is "to buy the first prize at a high price and to build a tumor immune matrix to cope with the cliff of hepatitis C drug sales. The direction is no problem. The key is to see the implementation of follow-up products."

New hot spot: antibody coupled drugs

The anti drug drug conjugated to the small molecule of anti drug is a kind of monoclonal antibody which can be linked to the small molecule of drug. Through the specific recognition of tumor cell surface antigen by antibody, the target cell can enter into the cell under endocytosis, release small molecules of toxin, and play a killing role.

The advantages of ADC drugs lie in that they not only have the precise targeting effect of antibody drugs, but also have the powerful killing effect of small molecule cytotoxic drugs, so they have become the focus of various researchers.

The research on ADC can be traced back to the 1980s, but it was not until 2000 that the first antibody coupled drug Mylotarg developed by Pfizer was approved by FDA for the treatment of acute myeloid leukemia. However, due to the limitations of coupling technology, targeting and effectiveness, the complete antibody coupled drug was unstable in the blood, resulting in lethal toxicity, and was withdrawn from the market in 2010.

After that, with the improvement of technology, adcetris was approved by FDA for lymphoma in 2011, and kadcyla was approved by FDA for HER2 positive breast cancer in 2013, which is the first antibody coupled drug for solid tumors. ADC drugs once again enter the vision of more R & D personnel.

In 2019, the FDA approved three ADC drugs in a row, and antibody coupled drugs have become a hot topic in new drug approval and transaction merger in recent two years. AstraZeneca entered into two transactions of antibody coupled drugs on March 2019 and July 27, 2020, with the transaction volume of US $6.9 billion and US $6 billion respectively.

There are more and more targets and indications of ADC drugs. Among them, it took less than 3 months for enhertu to submit its application for listing to be approved. Evaluateparma predicts that by 2026, cancer will be the treatment field with the highest proportion of global drug market, and the listing of enhertu is one of the main driving factors. It is expected that the sales volume of satechivan will reach 1.54 billion US dollars in 2024.

"ADC is a new type of treatment technology. With its unique antibody coupled cytotoxic drugs, ADC has unique drug properties. At present, it has shown irreplaceable efficacy in rare cancer types and end-stage patients, such as t-dm1, ds-9201, immu-132, etc. at the same time, there are opportunities to impact the first-line, such as ds-9201. At the same time, as a kind of platform technology, there are strong technical barriers and scalability, and the future The market will further expand at a high speed. " Qu Rong pointed out that among the seven types of antibody drugs approved by FDA in 2019, three of them are ADC, and ADC also ranks first in financing amount and authorized amount in biopharmaceutical field in 2019. At the same time, adc-2, as a target of immucs-2, has strong opportunities to expand. The key is whether you buy it right, not the price. "

In fact, many pharmaceutical companies in China are following this wave of hot spots. For example, Kelun pharmaceutical, baiaotai, DUOXI biology, Junshi biology, Kaidi biology and other companies are developing antibody coupling drugs targeting at Trop-2.

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