The year had opened on a buoyant note. But February quickly dashed any hopes of a market rebound and reinforced that volatility isn’t going anywhere in a hurry.After beginning the year on a positive note, biotech indices dipped in February. The Nasdaq Biotechnology Index (NBI) was down 6.3 percent (at US$ 4,075), the S&P Biotechnology Select Industry Index (SPSIBI) fell 7 percent to US$ 6,451 and the SPDR S&P Biotech ETF (XBI) dropped 7.7 percent to US$ 82.85. In January, NBI was up 4.4 percent, SPSIBI had increased by 8.7 percent, while XBI had risen by 9 percent.Many drugmakers announced
their 2022 results last month. Several mega cap drugmakers, such as Eli Lilly, Johnson & Johnson and Pfizer saw their stocks get hammered for a straight second month. February didn’t witness any significant deal or buyout.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel)Low demand for Covid drugs impacts Lilly, J&J; Moderna, Roche issue
lower guidanceIn our last month’s report, we had carried news about Lilly and J&J
posting lower revenues due to a drop in sales of their Covid-19 treatments. Not
only did Lilly’s Q4 revenues decrease, its diabetes drug Mounjaro also failed to live up to investors’ expectations. All this news resulted in a 9 percent drop in Lilly’s stock.It was a tough month for J&J (-7 percent drop in stock) as
well, whose Q4 revenues declined by 4 percent to US$ 23.7 billion and its Covid-19 vaccine experienced a 57 percent drop in sales. J&J’s autoimmune disease drug Remicade saw a 37 percent drop in sales due to competition from biosimilars. And, after a court rejected J&J’s two-step bankruptcy strategy for its talcum powder lawsuits, the US Supreme Court rejected the drugmaker’s appeal against a US$ 302 million verdict in a lawsuit filed by the state of California, accusing J&J of hiding the dangers associated with its pelvic mesh devices. Though Roche (-5 percent) posted a
2 percent increase in 2022 sales (at US$ 67.6 billion/CHF 63.3 billion), its
guidance for 2023 cautions of a US$ 5.5 billion sales drop due to its Covid-19
therapy and diagnostic kits. Gilead (-5 percent) failed
to register any growth in its
2022 revenues largely due to a 30 percent drop in sales of its Covid-19
treatment Veklury.Moderna (-20 percent) said it
expects the annual sales of its Covid-19 vaccine to be around US$ 5 billion in 2023 – less than a third of the US$ 18.4 billion it had hauled in 2022 – due to falling demand for its vaccine. Its messenger RNA-based influenza vaccine demonstrated a strong immune response against A strains of the flu, but proved less effective against the less common influenza B strain.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel)Astra posts 19% rise in 2022 revenues, Keytruda pushes up sales for
MerckBolstered by a rise in the sales of its immunology, neuroscience
and aesthetics treatments, AbbVie’s 2022 revenue grew by 3.3 percent to US$ 58 billion. Its stock
rose 5 percent in February.AstraZeneca reported 2022 revenue of US$ 44.35 billion, a growth of 19 percent over
2021. Cancer treatments accounted for 35 percent of its business, with its blockbuster drugs Lynparza, Tagrisso, Imfinzi and Farxiga registering significant sales growth. Astra plans to deliver at least 15 new medicines this decade and initiate at least 30 new late-stage clinical trials this year. Astra's stock went up 3%.Buoyed by the sales of
diabetes and obesity drugs, which brought in US$ 22.8 billion (DKK 156.4
billion), Novo Nordisk’s 2022 sales reached US$ 25.3 billion (DKK 177 billion), a growth of 26 percent year-over-year. Novo’s stock was up 2 percent.Merck (2 percent) reported an
increase of 22 percent in 2022 sales, reaching US$
59.3 billion. This growth was mainly driven by its blockbuster cancer drug Keytruda and human papillomavirus
(HPV) vaccine Gardasil. The drugmaker continued to experiment with Keytruda
across different types of cancer, achieving success in two trials while experiencing setbacks
in two others. Meanwhile, Merck said it expects sales of its Covid-19 pill
Lagevrio (molnupiravir) to decline from US$ 5.7 billion in 2022 to just around US$ 1 billion in 2023.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel) Seagen gains on buyout
report; GSK kept quiet about Zantac’s cancer risksSeagen’s stock surged by 30 percent last month. The cancer treatment specialist announced positive full-year results, with its revenue growing by 25 percent in 2022 due to an increase in sales of its antibody-drug conjugates. The Wall Street Journal reported that Pfizer was in early-stage talks to buy Seagen for over US$ 30 billion.Pfizer’s stock continued to slide. After registering a drop of 14 percent in January, Pfizer’s stock lost 7 percent in February. The drugmaker and its French partner Valneva decided to discontinue half of the total number of recruited participants in the US in a phase 3 trial of their experimental Lyme disease vaccine due to violations of clinical trial regulations by a third-party contractor.GSK’s stock dropped 3 percent in February. A damning report brought out by Bloomberg said GSK’s scientists knew for decades about the cancer risks associated with its popular heartburn drug Zantac (ranitidine), but the drugmaker chose to keep quiet about them.In positive news, an external panel of experts supported both Pfizer and GSK’s respiratory syncytial virus (RSV) vaccines. The US Food and Drug Administration granted full approval to GSK’s Jemperli (dostarlimab) in endometrial cancer. Moreover, the agency’s panel of external advisors backed GSK’s proposed single-arm trials to gain accelerated approval of Jemperli in rectal cancer.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel) Apellis’ geographic atrophy drug bags FDA nod; FTC scrutinizes Amgen-Horizon dealSanofi (-4 percent) decided to halt a late-stage clinical trial of its oral drug for myasthenia gravis – tolebrutinib – that it had acquired through its US$ 3.7 billion takeover of Principia
Biopharma. Despite its 2022 revenues growing by 7 percent to US$ 47.1 billion (€43 billion), Sanofi fell short of meeting market expectations. In a positive update, FDA approved Sanofi’s Altuviiio to prevent and treat bleeding episodes in people with hemophilia A. The Federal Trade Commission has issued a second request for
information regarding Amgen’s US$ 28.3 billion acquisition of Horizon Therapeutics. Amgen’s stock dropped 6 percent. And in a setback to Jazz Pharmaceuticals, a US appeals court has upheld an injunction that states a patent related to the drugmaker’s narcolepsy drug should be removed from FDA’s Orange Book. Jazz’s stock lost 11 percent in February.Among mid- to small-cap companies, Apellis Pharmaceuticals’ drug Syfovre (pegcetacoplan) has been approved by FDA as the first-ever treatment for geographic atrophy, a major cause of blindness. Apellis’ stock went up 20 percent in February. And Ambrx Biopharma’s stock shot up 200 percent after it posted encouraging initial data from an ongoing phase 1 trial of its experimental prostate cancer drug.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel) Our viewThe
drop in sales of Covid drugs is contributing to a negative outlook around
financial performance of some large drug companies. With the pandemic receding,
this was bound to happen. Even though January raised hopes of market watchers,
February has proven that we truly live in a VUCA (short for volatility, uncertainties,
complexity and ambiguity) world.Access the Pipeline Prospector Dashboard for February 2023 Newsmakers (Free Excel)
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