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Despite good data, Ironwood’s shares plummet 

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Today, we’ll discuss how the U.S. government is cracking down on Chinese biotechs, and how that might affect the industry stateside. Also, a positive clinical trial for Ironwood Pharmaceuticals still causes a stock slump, and more.

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Scrutiny of Chinese biotechs on the rise

The federal government and lawmakers have both been ramping up scrutiny of Chinese biotech companies lately. The Biden administration just issued an executive order directing federal health officials to guard against providing contracts and grants to companies, including U.S. firms, that could lead to foreign adversaries getting Americans’ sensitive health data.

On Capitol Hill, meanwhile, legislation would prohibit the U.S. government from contracting with companies that do business with Chinese “biotechnology companies of concern.”

Much of the anxiety centers on WuXi, a Chinese company considered a crucial partner for discovering, testing, and making medicines that has worked with biopharma companies including as Pfizer, AstraZeneca, and GSK.

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Are biotech’s dog days over?

What’s a PIPE? And what can unseat Wegovy? We cover all that and more this week on “The Readout LOUD,” STAT’s biotech podcast.

We dive into the the latest craze in the world of biotech finance, involving hedge funds and some insider information, and explain why not everyone thinks it’s such a good idea. We also discuss a banner month for biotech stocks and the latest twist in obesity research.

Listen here.

FogPharma raises $145 million for helicon therapy

FogPharma, a Cambridge, Mass., biotech developing treatments for cancer, just closed a $145 million Series E round. The company is designing corkscrew-shaped peptides called helicons that block a signaling pathway called beta-catenin, which is found in many solid tumors. It’s being tested in a Phase 1/2 trial, with data expected later this year.

CEO Mathai Mammen, former R&D chief at Johnson & Johnson, told STAT that FogPharma is actively looking for ways to couple its helicon therapy with immune-oncology drugs made by other companies.

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Pfizer will focus on antibody drugs

Pfizer has been struggling with investor dissatisfaction, and is making plans on how to manage the Inflation Reduction Act. The drug giant’s stock dropped 44% last year thanks to a standstill in Covid-related revenue, and the specter looms of many of its key drugs soon going off patent. It said the mix of small molecule drugs in its cancer portfolio will drop from 94% last year to 35% in 2030.

So now, Pfizer’s oncology unit will focus more intently on protein-based drugs instead of small molecules, which are more vulnerable to generic competition. One Pfizer exec said “this planned shift to biologics is expected to support the accelerated growth in both the top and bottom line.”

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Despite good data, Ironwood’s shares plummet

Ironwood Pharmaceuticals’ short bowel syndrome drug performed well in a Phase 3 trial, but the company’s shares still tanked 30%, FierceBiotech writes. That’s because the results didn’t convince investors that the medicine would beat out Takeda’s Gattex, which is already on the market, or Zealand Pharma’s glepaglutide.

Ironwood bought VectaBio last year for $1 billion, acquiring apraglutide, a long-acting GLP-2 analog. It expected the drug to be best-in-class, but the data fell a bit short when looking at secondary endpoints. The company still intends to file for approval of apraglutide.

More reads

  • Pharma companies ask court not to break up US states’ price-fixing lawsuits, Reuters
  • Novo Nordisk’s new Boston-area campus reflects ‘competitive’ R&D growth, and not just for GLP-1s, Reuters
  • RSV vaccines may be linked to small increased risk of developing Guillain-Barré syndrome, data suggest, STAT
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