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Bayer, short on cash, reaches into shareholders’ pockets

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The need-to-know this morning

  • Rapt Therapeutics said the FDA placed a clinical hold on its anti-inflammation drug, called zelnecirnon, following a case of liver failure in one patient enrolled in a mid-stage atopic dermatitis study. A separate study in asthma has also been placed on hold. Rapt is investigating the cause of the liver failure.

Biotech startups keep downsizing

The latest is Sonata Therapeutics, born from the merger of two Flagship Pioneering companies, which has laid off about a third of its staff.

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As STAT’s Allison DeAngelis reports, Sonata has parted ways with 21 employees in recent weeks, significantly reducing its prior payroll of 63 people. The company was created in 2022 through the merger of two Flagship startups, Inzen Therapeutics and Cygnal Therapeutics, and is developing medicines in oncology, fibrosis, and autoimmune disorders.

Sonata is among a growing number of privately held biotech startups that have cut staff, curtailed ambitions, and pivoted focus in an effort to conserve cash in a difficult environment for raising venture capital.

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Bayer, short on cash, reaches into shareholders’ pockets

German pharmaceutical giant Bayer is slashing its dividend by 95%, part of an ongoing effort to conserve cash in the wake of its disastrous 2018 merger with Monsanto.

After paying out about $2.50 per share last year, the company’s dividend will amount to about a dime in 2024, Bayer said yesterday, a cut that will save about $2.5 billion a year and help the company pay down its debt. The move follows news of a planned reorganization in which CEO Bill Anderson, who took the reins last year, will significantly reduce the firm’s managerial ranks and lay off hundreds of employees.

What remains unclear is whether Bayer will heed the oft-repeated advice of analysts and investors by splitting its business up, separating its pharmaceutical and consumer health businesses from the crop science division that has been dragging the company down.

A cancer milestone four decades in the making

After a series of technological roadblocks, clinical setbacks, and regulatory delays, the FDA approved the first cell therapy that can treat solid tumors, a long-awaited milestone in oncology.

As STAT’s Angus Chen reports, the treatment is called Amtagvi, made by Iovance, and it’s approved to treat advanced melanoma. Amtagvi is made up of tumor infiltrating lymphocytes, or TILs, which are cancer-fighting immune cells harvested from a patient’s body, duplicated in a lab, and then re-infused to kill tumors.

“This is a game-changing moment for our field,” said Allison Betof Warner, a cell therapy researcher and physician at Stanford University who has worked on Amtagvi. “We’ve seen huge success of cellular therapy for hematologic malignancies, and we’ve yet to capitalize on that for solid tumors. This is hopefully the first of many to come.”

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What happened to the phage revolution?

Every year or so, there’s a case report of how a bacteriophage — a virus that infects and kills bacteria — has led to dramatic benefits for a patient with a life-threatening infection, stirring hopes that scientists might soon have an answer for treatment-resistant bugs. But despite undeniable promise and years of labor, successful phage therapy remains largely a case-by-case phenomenon.

As STAT’s Deborah Balthazar reports, the biggest hurdle is complexity. There are thousands and thousands of phages in nature, all behaving differently and killing specific strains of bacteria. Fitting that known universe into a medicine cabinet requires cataloging as many phages as possible, an ongoing but daunting process.

Then there’s the matter of running the kind of study that could lead to FDA approval, which requires standardizing phages and specifically recruiting patients who are likely to benefit from a given therapy, a tricky process considering all the variability of bacterial infections.

Read more.

More reads

  • A lawsuit over a controversial Sanofi drug shortage is unexpectedly revived, STAT
  • After patient outcry, Taysha starts to offload drug programs, Endpoints
  • FDA expands use of asthma drug Xolair to treat severe food allergies, Associated Press
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