第201期 - 2026年10月30日

You're listening to Biotech Hangout, a live and unedited weekly discussion of all the latest news in our industry with a group of biotech leaders and experts. I'm Chris Garabedian, and my co-hosts today are Graig Suvannavejh, Brian Skorney, Yaron Werber, and Sam Fazeli. For more information about our hosts and guest speakers or to listen to the most recent episode, please go to biotech.com. There were a lot of conferences this week and a lot of news, including some AI. It was a very interesting week. We’re going to start with some macro and some deals. Sam, do you want to start us off with the salient points?

These are some salient points from the recent pharma reporting. We’re not quite done yet, but I wanted to focus on M&A and China, which are the things that exercise biotech investors’ minds. I’ll give you some tidbits from various pharma companies.

1. Pharma M&A and China

Eli Lilly very clearly stated that it’s following the path it’s been on, which is early- and clinical-stage deals. I don’t think it’s particularly worried about the risk profile at the moment, although I think it does quite a lot of de-risking internally. The company expects to do more activity across all therapeutic areas, but specifically mentioned immunology, neuroscience, and oncology, which is quite interesting.

Bristol Myers Squibb talked about continuing to do exactly what it was doing before: remaining agnostic on deal size, with capital allocation for business development as its priority, and not waiting for any particular transaction. It’s doing deals as things come through. The company noted $13 billion in cash and marketable securities in the bank, and of course it has access to debt.

Lastly, I thought it was quite interesting to hear Novartis talk about its continued strategy of focusing on bolt-on transactions below the $2 billion level, with larger deals only on a selective basis. They brought up the Avidity outcome. People have been wondering whether the trial news coming out of that would affect Novartis’s view on M&A, and it doesn’t look like it. I think the company has been very philosophical about it.

Reading between the lines, all these companies are still super active across the therapeutic continuum, with Lilly specifically highlighting immunology, neuroscience, and oncology. Quickly on China—

No, I was going to say, it sounds like there’s an optimistic view that over the next few months, with Jefferies next month and J.P. Morgan toward the end of the year, we should see a better M&A market than we did in the third quarter. I think that’s possible. I’ve been to some recent VC meetings where one VC said they had four or five companies in the term-sheet stage.

So whether those deals close in Q4, who knows? But there’s quite a lot of activity going on.

Yeah, you can go on to China.

I can be very quick on this one. I’m just going to bring up what Sanofi said, which I think was the most detailed comment when it comes to China. Sanofi’s CEO described China as a thriving hub for scientific advancement and said the company plans to source innovation globally, including from China, which is what every pharma company continues to say.

The CEO also noted that Sanofi’s strong commercial presence in the region helps with both manufacturing and bringing in drug-development partnerships. The head of R&D also said that faster translational efficiency is a key advantage of working with Chinese partners. I don’t think there’s anything new in any of this, but it’s nice that a pharma company specifically brings it out and says it, because we pontificate a lot about what’s positive about China.

Great. Graig, do you want to talk about Alnylam? We had a big stock move this week. There’s a lot of chatter on X about Alnylam’s overall strategy and the position it had built. What was happening?

Thanks, Chris. Alnylam Pharmaceuticals is a company I don’t really cover, but I’ve been following it from afar. What an incredible success story it’s been overall. This week, and for that matter this year, has been really tough for the company’s stock performance.

The company reported third-quarter results, and I think 2 updates in particular sent the stock reeling. First, it was all about sales of Amvuttra, its drug for ATTR. It’s become a very competitive landscape, but sales were $81 million in the quarter, versus $129 million in the second quarter. That’s a meaningful decline.

The CEO said the results were certainly not satisfactory, despite underlying growth demand. This comes despite the company recently increasing its sales force. There was also a lowering of guidance for the product this year, the second guidance cut for the franchise this year.

The stock has been down about 30% over the past week and is down 60% year to date. We have a lot of admiration for all the great things the company has done, but it also shows that you can get a lot of accolades when you generate positive clinical data. When you try to launch your own drug, the rubber hits the road, and Alnylam is facing some commercial challenges.

For sure. Some of the chatter on X was that they didn’t use their stock currency and position of strength to make acquisitions to help diversify their pipeline. It’ll be interesting to see if they start thinking about that beyond their current franchise.

It’s hard to go through any week without AI being a big topic in biotech, but this week there was an unprecedented deal involving Anthropic. Brian, do you want to kick us off on that? It might lead to a broader discussion.

2. Anthropic Moves Into Biotech

Yeah, happy to, Chris. I’m sure we all have a lot of commentary on this. Earlier this week, Anthropic filed an S-1, and for those of us in biotech, there was a surprising amount of language highlighting life sciences as an explicit strategic expansion for the company.

They go through a number of details in the S-1, including the acquisition of a computational biology company, Coefficient Bio, in April of this year. They’re talking not just about helping companies in the development space with their AI capabilities, but actually moving into drug development themselves.

It also came through in some of the public filings that they acquired a company called Methyl Medicine. It’s a one-person biotech company run by Cody Tranbarger, who has been working with our friends at Atlas Venture for a number of years. Graig and I know him really well. We do this crazy run every fall, and Cody is part of that crew.

To add to the surprise, Cody also revealed himself to be the person behind the Twitter alter ego Professor Oak. I think the world of Cody, and I greatly respect the tweets from his Professor Oak persona. We all wish him the best, and I’m sure he’s going to be very successful.

It was a very interesting series of events and news related to Anthropic. I’m sure everyone here gets a lot of questions about how AI is going to impact biotech. We’ve talked about this on the Hangout many times. Some people in AI make very grandiose comments about how AI is going to totally transform things and cure all diseases in 10 years—stuff that those of us who have been working in the industry for 20 years shake our heads at.

There’s no doubt that AI is going to be a big factor in driving efficiencies. But how much of an impact will it have, and how differentiated will any of these AI capabilities be? Is talk of curing all diseases in 10 years bubble talk, getting way over our skis? Is it setting up a hope that can’t really play out? There’s been robust debate about that, and I’d love to start the conversation. How is everyone here viewing the impact of AI? I know what I say when people ask where AI will drive biotech over the next 5 to 10 years, and whether all these AI companies are going to swallow up biotech. I’d love to hear everyone’s perspectives.

Let me put some context around this, because I think this conversation is reaching a fever pitch. A few blog posts have come out this week. First, this morning Bruce Booth posted a really nice article from an old-guard perspective, making the point, Brian, that we have to be careful.

I thought he drew a really good distinction between drug discovery and developing a lot of new molecules, particularly around validated targets. That’s very easy, and he’s almost predicting even more crowding than we’re seeing today. New target identification for unvalidated targets isn’t as simple. We don’t understand human biology and the pathology of disease, pathways, and so on.

He’s predicting an overall bottleneck in a lot of assets early on, but ultimately the infrastructure can absorb all of those assets.

And at the end of the day, we’re going to have a lot more pucks to shoot at the goal, but you’re still limited in how many trials you can do. You still need to do traditional drug development. I thought it was a really good, nuanced take.

On top of that, Elon Musk posted something from a guy who goes by MGoDistance. He was touting biotech, how amazing it is, and all the successes and big wins we’ve had recently and over the last year. But he was tying it almost exclusively to AI and how AI is helping. I think that’s kind of a false narrative, but Elon Musk retweeted it and said, “I’ll just read it: ‘If you look closely enough, breakthroughs in everything are accelerating exponentially. An exponential always starts off looking small.’” And he’s commenting on biotech.

Interestingly, Vinod Khosla commented on that, too, and said, “Agree 100%, but unlikely it will come from the big biotech companies.” Dave Ricks, the CEO of Lilly, said, “I’ll take that bet.” Then Vineeta Agarwala from a16z said, “I don’t know. I wouldn’t count big biotech out.” So anyway, the dialogue is interesting.

There was another post by a guy named Egon Pelton [?]. Frank David retweeted it this morning, and others commented on it. It was too long; I haven’t read it yet, but I will later. It was talking about more nuanced ways of thinking about the impact, similar to Bruce Booth’s themes, particularly around chemistry. I used to tout Derek Lowe, who borrowed a phrase for biotech: “Computers aren’t going to replace chemists, but chemists with computers are going to replace chemists without computers.” I’m starting to question that and wonder whether computers will replace chemists, because when you’re looking for patent-busting and finding new IP around a scaffold and a new target, it does seem that AI could provide a lot of support.

These are interesting times. And then, related to Cody’s one-man Anthropic acquisition, I think this is facilitating what we’re already seeing: how do you address R&D efficiency, and how do you produce lean teams? We’re already seeing smaller teams, virtual outsourcing, and fractional C-suites, rather than building out big teams. On the venture side, I’ve supported a couple of companies that are in the clinic, in some cases running pivotal studies, with 20 employees. I have one that’s on the cusp of Phase 2, with one full-time CEO, raising a Series B to build out a small team. I think this idea of smaller teams is here to stay, and AI is going to facilitate that. I’d love to hear from the other co-hosts about their thoughts and comments on this whole AI theme.

In our chat, I think Sam brought up a very provocative question. AI is absolutely going to make a difference, and eventually people are going to have a lot more free time because they’ll be in their self-driving Tesla on the way to work. That’s going to make them a lot more productive and free up time. So that’s one contribution from AI for sure.

We use AI quite a bit on my team, and I can verify that it’s making a significant difference for some relatively basic tasks where I need massive amounts of data gathered and sifted through. I’m finding that I can displace two or three contractors doing some data gathering, which I can now do myself. I still need a human in the loop to finalize the quality of the data. That part isn’t going away. But do I need two or three days of people doing something? There’s no question. I think every one of us will have that.

Big data is absolutely the sweet spot of AI, and the bigger it gets, the harder it gets. Add genomic data and GWAS analysis data to that. I’m making an effort to talk to as many AI-enabled companies as I can, many of which are still private, to understand how they’re applying it.

One last thing: at ESMO, I don’t know if you noticed it too, but I walked through the poster area one day and came across two massive banks of AI posters—not rows, banks. I didn’t go through them one by one, but I’m certainly going to look at every single one to see where they’re applying it. It was probably a whole mix of academics and companies.

We will generate value out of this; there’s no question. The thing is, does it really make a huge difference to our ability to identify and clarify biology better? I think in some areas it will. I know companies using it specifically for that purpose, based on population data and biobank data. I’m very excited about it, but the fruits will take time because you still have to put them through humans.

Yeah. I also think we’re still lacking good translational models that predict what will happen in humans. At the end of the day, especially with new targets, you won’t know until the rubber hits the road with a true clinical study in human subjects and a data readout. It’ll be interesting to see how that evolves and whether we increase the success rates. Graig, Brian, anything else to comment on the AI theme?

I was having dinner the other night, and we were talking about this. A PM I was discussing it with said, “Oh, this is definitely the most transformational technology that we’ve seen in our lifetime.” I pushed back a bit. It’s super transformational, and we use it all the time, but I’d argue that the internet itself was super transformational. We’ve sort of democratized information flow, but a lot of problems have come with that, too. There’s a ton of information on the internet, and a ton of misinformation.

AI functions as a way of taking in a lot of information and analyzing it very quickly. But everyone who has been using AI finds that it makes a lot of mistakes, too. It’s probably because, as a lot of people in the tech world say, “GIGO”—garbage in, garbage out. Getting the right information in, analyzing it, and getting the right outputs is very important.

Chris, you bring up a very good point, because I think the real bottleneck in drug development isn’t target identification or drug design; it’s clinical development. I just don’t know how you get around testing for a year and a half in an outcomes-based study for cardiovascular disease in 10,000 patients. That’ll take 5 years to run and cost $300 million. Until we solve for that inefficiency, I think the efficiencies AI brings will be meaningful, but more marginal—and certainly won’t accelerate things by 90%.

Yep. Graig, any final comments on that?

I would argue that AI will be transformational for everyone, but particularly in biotech. To Brian’s point, clinical development is still the biggest challenge. I’m not sure how AI will necessarily speed up mid- to late-stage clinical trials. But I’m hopeful AI can help at some point with better patient identification, increasing the probability of technical and regulatory success, as the industry likes to call it, or, as we like to call it on our side, PoS—probability of success.

Whether it’s on the drug discovery side or the patient identification side, that’s where AI is going to be really helpful. But at the end of the day, you’re still going to do a 6-week, 6-month, or 2-year outcomes study. I don’t see how AI is going to change that.

Yeah, I think we agree. I believe that if AI figures out the human biological system, it has figured out everything else. Engineering, physics, everything else—this should be the hardest industry for AI to be truly transformational in. So if we’re all out of jobs, I don’t think there are any jobs after that.

But let me chime in, joking aside about the self-driving cars. We cover this specific area, too. One thing is that it might not be totally ready, and biology may be the limiting step for new target identification. But AI is helping platforms find protein–protein interactions and ultimately really understand how proteins are structured and move in real time. As we all know, all of that needs a lot of wet-lab capabilities at scale, but it’s absolutely helping with new undruggable target identification.

Look at Amgen. Amgen has been an early adopter of AI, and we’ve all noticed how fast they’re enrolling their studies. They’re leaps and bounds faster than anybody else. Recall that they enrolled their Lp(a) study in 16 months. It took Novartis about a year and 2 months longer. They’re doing that with informatics and AI. It’s about patient identification, site identification, and site mapping.

And because of that, they’re able to enroll super quickly. We’re already seeing some of these benefits. Sounds like we might have lost Chris. Have we lost Chris?

We may have.

Yeah. Yeah.

We just got Graig. Do you want to take over while we’re getting Chris back?

Sure. As we think about the program, we were going to transition at some point to a discussion about biotech IPO performance. I’m happy to transition there before Chris comes back. Go ahead.

But before I do that, I just have to correct myself. I talked about BeiGene before, and they did report $1.13 billion in Brukinsa revenue. It was the U.S. demand growth—or demand in the quarter—that I erroneously misquoted as having declined. I want to thank Claude for prioritizing that number and making me do that.

In any case, let’s talk about IPOs. I think—

Yeah, let me—before—

Oh, yeah. Go ahead. Go ahead.

3. Biotech IPOs and Market Sentiment

Before we go—sorry, I dropped off. I just wanted to highlight that biotech and tech used to trade pretty consistently, and we’ve seen a bifurcation over the last year and a half. After the downturn in biotech, tech was increasing. I think this is important in the context of the public markets, Graig, before you get into this.

The crypto heist came to about $6.3 billion, basically hacked out of Binance. They took Bitcoin from these hot wallets. This is happening alongside a real tech downturn. Alphabet lost 13% of its market cap—$500 billion in market value—on an earnings disappointment, largely due to its AI buildout and data center expenses. Amazon announced guidance of $220 billion in expenses just for AI data center buildouts. Microsoft announced layoffs or offered packages to 27% of its workforce to prepare for the AI future.

Big tech is cannibalizing its own proven, profitable legacy business structures to fund an unproven AI buildout. People are starting to question whether all of this AI spending is actually going to result in better revenue, earnings, and profitability. Tech is going through almost an existential crisis right now, with a lot of negative sentiment. Biotech, ironically, which used to trade as a high-risk sector, might be seen as a safe haven. We’re hopeful that some of that money flows into biotech.

I just wanted to provide that high-level context, Graig. What’s happening with IPOs, and are we optimistic going into the latter part of the fourth quarter?

I think we should be. In the past couple of weeks, we’ve seen 3 more issues debut, and I think 2 are debuting today. By my unofficial count, we’re at 31 year to date. We’re getting closer to the number of 50 that Josh Schimmer predicted late last year we might see.

Of the new issues we’ve seen in the past couple of weeks, one has done really well. Lycia Therapeutics, a protein degrader company, popped about 60% last week on its first day of trading. It settled in and closed up about 30%.

Two more have come to market today. One is Bamboo Therapeutics. They’re working on bispecific antibodies in the I&I space, and I think the lead asset is in atopic dermatitis. The other is Aspen Neuroscience, a cell therapy company working on Parkinson’s disease. What’s interesting is that these 3 companies represent a pretty broad range. But it’s also interesting that Bamboo and Aspen, which are debuting today, are Phase 1 companies. It looks like investor appetite is still there for earlier-stage companies.

I think we all share a concern that sometimes companies aren’t ready for prime time. With that in mind, I’ll mention a company I cover that had a really good update at ESMO this week. I know we’ll talk about ESMO later, but Eikon Therapeutics, I think, was the second IPO this year, back in February. It debuted at $18 and is now trading at about $5, a meaningful decline since its IPO debut. It does have plenty of cash, though—more than $500 million.

The IPO market has been very good for biotech by number of offerings and by volume. But when I looked at the stock prices, at least half are down versus their debut price. We’ve also seen a downturn in the biotech market over the past 2 months. It’s been a very painful 2 months for investors, but that’s where we are in the biotech markets. Maybe I’ll turn it back.

Eikon is a tough one because it was more of a platform company. Roger Perlmutter—many believe it was pretty overvalued. It’s tough to see that downturn, but a lot of the IPOs are product-driven, clinical-data-driven, with drugs expected to get approval.

I’m encouraged by your comments, Graig, because, together with the encouraging comments on M&A, it says we might be back on track over the next few months, with the election behind us and that uncertainty behind us. I’m hearing a lot of positive sentiment on the FDA, too. Adam Feuerstein tweeted that there are 10 more potential FDA approval decisions before the end of the year. We’ve already had more than 50 novel drugs approved this year. This could be a record-setting year for FDA-approved drugs, surprisingly, with all the tumult we’ve had with FDA leadership and turnover.

Any other comments on the state of the markets from the co-hosts? I don’t want to be the damp squib here, but why not? Let’s do it for the sake of argument.

That’s what we like. We don’t like to be a monolith here.

Yeah. Post-midterms, there are these potential rumors of a major attack on Iran, which could result in retaliation against the various hubs there. That could mean a massive jump in oil prices and higher interest rates. Last time, around April, when I mentioned the possibility of interest rates going up at the back end of the year, I think some of you guys laughed at me. You didn’t laugh at me—you went, “Really, Sam? Most of us are expecting them to go down.” And look where we are.

Again, I know nothing. I just reflect what people who actually know what they’re talking about in our community, and at Bloomberg, are talking about. There’s this issue of interest rates, which we’d love to believe aren’t related to or impacting biotech, but I think they do if they go high enough. Then there are tariffs. We expect tariffs to come back with a vengeance post-midterms, which would mean more tension and more inflation.

Let’s not be too surprised if the market starts deciding, “I don’t like this risk,” and interest rates go up so much—hopefully not—that the risk-free rate becomes higher and higher. It becomes easier to park your money in a bank or a Treasury or something.

Those are valid comments. Interest rates really do have an impact. That was the real reason the third quarter was tough on the XBI. Any other comments before we move to the next topic? All right, why don’t we? I’m going to touch quickly on rare disease.

This has been an area with a lot of sluggishness and headwinds, but I think there are some positive things we’re seeing. The FDA had a rare disease pathway meeting this past week. There’s an open comment period through December 12 for any CEOs or policy folks who want to weigh in on the guidelines.

I’ve been hearing about this from industry for more than a decade. Janet Woodcock weighed in this past week, too, and there’s a 4-hour hearing you can watch live to understand the discussion. The meeting covered establishing a more standardized, fit-for-purpose regulatory review across both CDER and CBER, tailored to the specific and unique constraints of rare disease drug development.

They’re signaling a coordinated institutional commitment through the FDA Rare Disease Innovation Hub to align across review divisions, acknowledging the statistical and enrollment challenges of small sample sizes. They’re also trying to codify the flexibility they’ve always signaled. They covered real-world evidence and the expectations there, as well as institutionalizing the patient and expert voice. They’ve made some inroads on that with advisory committees and more. How can they hear from the experts who know these disease areas and make sure there’s real education around this? And there are flexible CMC and quality pathways, which can be challenging if you have a good drug and small production batches for a small study.

So, overall, I think this is a really good sign that they’re signaling an effort to make things easier for rare disease. This was even talked about when Marty Makary was there, so it’s good that they’re extending this effort.

Somewhat related, there was an announcement of a new company that was able to raise money. This is the plight of many rare disease companies, especially those involved with patient communities and trying to get a drug for their family or their child. In this case, angel and philanthropic investors put $7 million into a company called Plowshare, which addresses a disease in the Amish-Mennonite community, part of the Plain community in Pennsylvania. It’s called maple syrup urine disease.

They brought on Kevin Strauss, who led the Clinic for Special Children. He’s the CEO and has ties to the Lancaster, Pennsylvania, community. He was helping them get access to Zolgensma because SMA is prevalent in that community as well. They see it as a platform: in these insular communities, there are often many rare genetic mutations within a given community, and they’re going to try to pursue this one.

The challenge I see is that $7 million is great to get them started, but institutional investors will ultimately have to come in to bring this through clinical development and across the finish line. They’ve already got orphan and rare pediatric designations, priority review vouchers, and all of that. It’s just nice to see rare disease picking up a little bit, and hopefully this addresses some of the headwinds we’ve seen. It’s also nice to see philanthropic dollars, angel dollars, and the community rally around some of these programs, because there are a lot of them out there that just aren’t getting funded. Any other comments from the co-hosts on the rare disease efforts in our industry?

All right, let’s move on. We’ve got a lot of other data to cover. Let’s start with Palvella. Graig, do you want to kick that off?

Palvella Therapeutics is actually a company I cover. They’re in the rare orphan space and are really focused on dermatology. Their niche is going after rare orphan diseases—about 600 of them have no FDA-approved therapy. In a bit of good news for the company this week, we hosted them on a roadshow for investors in New York and virtually, and they just got a PDUFA date for their QTORIN rapamycin products.

Rapamycin is a well-known drug that’s been around and used in multiple indications and settings. It’s very difficult to formulate, so the company has a QTORIN platform. The first indication they’re going after is microcystic lymphatic malformations, or MLMs. The company estimates there are about 30,000 people in the U.S., but it could be as many as 95,000. This would be the very first drug for this condition.

They got a four-month review. If you assume a company files on a certain day, it takes 2 months for the FDA to accept the application. In this particular case, Palvella got a 4-month review, and I think this is because it’s not a new molecular entity; it’s a 505(b)(2). So, it’s 6 months after the filing date. There’s going to be an approval here, and this drug has pipeline potential in as many as 3 other indications. That’s some news on the rare disease front.

Yeah, and, Graig, you have another topic you’re going to cover next. We know the binary nature of biotech and how much a stock can move. Do you want to talk about Acumen?

Acumen Pharmaceuticals was developing a drug for Alzheimer’s disease. We all know how difficult Alzheimer’s disease can be. Their candidate, which targeted beta-amyloid oligomers but not necessarily the plaques, failed. The data were announced today, and it was a phase 2 trial. The stock is down 80%. I’ve been in touch with the company. It’s obviously a challenging day for the company as well as for patients.

I did think it was important because we’ve talked in the past on this podcast about the cottage industry of companies working on brain shuttle technologies. These are assets that will be able to cross the blood-brain barrier. There’s a whole host of companies working on this, and maybe this result—which did not take advantage of any brain shuttle technology—underscores the idea that sponsors really need to think about whether they may need a brain shuttle, especially if they’re considering an antibody approach. It could help get the antibody across the blood-brain barrier and achieve the efficacy they need. It’s a tough day for Acumen today.

Yeah, brain shuttle technology is an interesting space. I think it’s going to open up a lot of disease areas if we can get it to work, and hopefully improve translation for these indications. It was a big week for conferences. There was a kidney disease conference and ESMO, and we’re going to cover all of that. Brian, you covered the kidney conference. What was going on there?

4. Kidney Drugs Halt Progression

Last weekend was the American Society of Nephrology annual meeting, also called Kidney Week. Kidney disease has been a busy investment area, with a lot of really good clinical development after what was maybe a pretty quiet number of years. Probably 5 years ago, this wasn’t that much of a hot space. I’d say it’s an area where we’ve seen some of the greatest improvements in clinical outcomes due to drug development, and I think a lot of that has been in a specific disease called IgA nephropathy. It’s a progressive kidney disease, and there are about 200,000 diagnosed people in the U.S.

What I think has been part of the benefit here is the learning over the last couple of decades that there’s an inflammatory process due to high levels of immunoglobulin A forming clumps in kidney cells. Over time, that inflammation causes scarring, and you have this progression over many years, ultimately to kidney failure. There have been a number of recent approvals for IgA nephropathy, including Filspari and Tarpeyo. There are newer drugs targeting complement to reduce inflammation, like Fabhalta and Ultomiris. But the most impressive programs, in my view, are the ones really hitting the underlying disease pathophysiology and reducing the antibodies that are causative here.

The hallmark one there is Voyxact. We saw the full data set from the phase 3 VISIONARY study. It was published in the New England Journal of Medicine in tandem with Kidney Week, alongside 3 other phase 3 papers in the journal. I’d also point out that my friend Jonathan Barratt, who I think is one of the world’s leading experts on IgA nephropathy, had 3 first-author papers. According to my Claude, that may be a record for one New England Journal publication. What’s really impressive in the Voyxact data—and this was a 2-year study—is that Voyxact was approved on an interim analysis of proteinuria, but now we see the full 2-year data. We already knew some of the data on the eGFR slope, which was the primary endpoint for the full data set.

Basically, this drug stopped disease progression. There was no change in eGFR—arguably, there was a numerical increase in eGFR—but let’s call it basically flat, versus placebo having a very steady decline. What was really new in this New England Journal paper is that we have composite kidney events, with a hazard ratio of 0.029. There was 1 kidney event on treatment versus 28 on placebo. The most meaningful one, kidney replacement therapy, didn’t occur in a single patient on treatment versus 5 patients on placebo.

This drug looks really safe. It’s a once-monthly subcutaneous injection at a low dose. It looks really great. Another drug, atacicept from Vera, also had its full data set, and they showed a reduction in outcomes along with a pretty significant effect on slowing the eGFR slope. There’s also Vera’s povetacicept, which is up for approval and has a PDUFA date in about a month. Its RAINIER interim phase 3 study also shows very similar outcomes in proteinuria. They don’t have a full 2-year eGFR slope, or a 1-year eGFR slope; we have to wait a little bit to get that.

There are 3 drugs targeting APRIL or APRIL and BAFF, and there’s a bit of debate as to whether you need BAFF, whether it provides a benefit or a liability, or whether it’s all noise. But we’ve seen a lot of improvement through this kind of dual targeting of APRIL and BAFF to materially improve outcomes for IgA nephropathy.

I just think it’s a really exciting space to watch develop, because by all the data, it looks like the disease has basically stopped in its tracks for people on these drugs.

Yeah. And if I could briefly jump in on the IgAN space and APRIL as a target: I cover a company called Climb Bio. They’re much earlier in development, but they had a good data set from their own study that mirrored some of the data from their Chinese partner, Mabworks.

We’re seeing more of this these days, where U.S. companies partner with Chinese companies and each run their own trials. The key thing is consistency between the data sets. For Climb Bio, the drug is called CLM-116. It’s still early, and they don’t have proteinuria or eGFR data yet, but so far, so good.

Great. I’ve seen on the venture side that the kidney is an organ that overall didn’t get as much attention, but we’ve seen a lot more interest in recent years in cracking the code on kidney-related diseases.

All right, ESMO occurred this week, one of the big oncology conferences. Sam, Yaron, do you guys want to help us cover what went on there?

Yeah, sure. I think Yaron and I are going to go back and forth, so I’ll give a quick introduction to what we saw. Saturday night was the big night, when we had the Presidential session. It was a bit less exciting for Moderna, because the data had already come out on Thursday, which we talked about last Friday. But the data that got a standing ovation and a nice long round of applause—and deservedly so—was Amgen’s DeLLphi-304 trial.

Overall, during ESMO, I think I saw at least one practice-changing data set. We saw data from Roche on divarasib, a KRAS G12C inhibitor, in non-small cell lung cancer. To me, that looks practice-changing, barring a few things to talk about if we get to it. And, of course, we had some data from AstraZeneca in gastric cancer that was really exciting and interesting, at least for third-line patients.

All in all, it was an exciting ESMO, but exhausting as well. It was in Madrid, Spain, where nobody starts eating until about 8:30 or 9:00, so I don’t think I ever got to bed before midnight. It was amazing, and I love seeing these Kaplan–Meier curves jump up. Before we get into anything specific, I want to get Yaron’s view on the whole conference and how he felt about it.

The conference was amazing. I think it’s becoming everyone’s favorite conference. It’s always amazing to be in Europe at that time of year, and there wasn’t a cloud in the sky in Madrid. There was a lot of data. ESMO is always busier than everybody expects.

I agree with you, Sam. On average, we went to sleep between 2 and 3 a.m. every night. The one disappointing element of ESMO was watching El Clásico, with Real Madrid playing Barcelona and Real Madrid winning. It was amazing to see that in the bar as a Barcelona fan. That was the low point of ESMO, but it was an amazing conference.

I guess the big question back to you, Sam, is: Did Moderna really get a standing ovation? That was a big debate.

I would argue it was a pseudo-standing ovation.

You think they got one?

I don’t think they did. I had a good look. I think I stood up to look, so if I count as a single person, then great. I did hear a group of people clapping a bit longer. The problem is that the data didn’t have an element of surprise, because it had already been announced by Thursday.

Again, as we talked about, everyone was looking for reasons to beat it up or explain the share price drop, which wasn’t really there. The share price has partially recovered, whether it’s retail, ETFs, specialists, Nasdaq 100 buying, or whatever. It is what it is.

That’s a pretty good segue. I’m going to talk very quickly about the other data Moderna had at the conference. A couple of elements stood out to me. One was their pancreatic cancer data: only 19 or 20 patients, and it was a poster. It didn’t look particularly as good as the data we’ve seen from BioNTech. That’s a tough comparison, because we’re comparing 2 early-stage trials, and it doesn’t have a huge amount of rigor. Nevertheless, that’s all we’ve got to go on.

What I took away from it was that about 50% of the patients had 34 new antigens generated. PDAC is at the bottom end of the TMB scale in terms of mutation burden, so that gives me a little more hope that they can generate enough new antigens—and high levels of them—relative to what’s available for the cassette, which is about 34 for Moderna’s vaccine. That, to me, was a positive.

The other interesting thing was that exactly the same percentage of patients failed to provide enough tissue to generate new antigens: 17%, the same as in the melanoma trial. I think the new-antigen generation capability is probably a complete coincidence, but the fact that they managed to make 34 new antigens in 50% of patients is a positive for other upcoming trials, which generally have higher TMB. Yaron, did you want to add anything to that?

I’ll take it from the BioNTech side. They were at the conference, but they didn’t have data on their vaccine. As you know, the vaccine platform has been largely disappointing. To zoom out for the audience, they’re focusing on 20 new antigens, not 34. It’s a different platform: unmodified mRNA and a totally different delivery module. They’re not using LNPs like Moderna does.

There are still questions about whether LNPs are partly triggering the immune system. That’s going to remain an academic question. BioNTech isn’t doing that now, and they’re beginning to split the company up a little bit. As you know, the 2 founders are going to spin off a new company. The timing is phenomenally good for Uğur Şahin and Özlem Türeci, because this is now an area that’s very much in vogue, unlike 6 months ago, when they announced the split-off.

The BioNTech shareholder base is a bit split on whether they should completely move away from cancer vaccines and focus on their pipeline, dramatically curtailing operating expenses, or whether they should keep the vaccines. We think they’re ultimately making the better decision, given that the platform is so different. They should focus on the pipeline: PD-1/VEGF, the very good CTLA-4 data in lung cancer, and their HER2 ADC in competitive areas. That’s probably where the future is going, and I think it bridges us into the PD-1/VEGF discussion.

It does. But I just want to go back to DeLLphi-304. This was overall survival data the likes of which I haven’t seen before in small cell lung cancer, even though the trial has only about 16 months of median follow-up—21.1 months, with a lot of censoring after the 12-month line, if I remember correctly, on the Kaplan–Meier curve.

This is practice-changing. What’s interesting is that DeLLphi-312 is coming up in first-line small cell lung cancer. I’m pretty convinced it will be successful and reset the setting, making it interesting for all the follow-on drugs coming along. People are putting a lot of effort into B7-H3 ADCs, SEZ6 ADCs, and DLL3 ADCs. When it comes down to it, they’ll have to compete with or complement tarlatamab in this setting. That’ll be quite interesting to watch. I’m happy to move on to Summit if you want.

Maybe quickly on the DLL3 ADCs. To the audience, this was a landmark standing ovation. I think we’ve seen very few like it in our careers—probably 5 to 7 that I can remember. The concern with ADCs is durability related to tolerability. The response rates have been higher than with the BiTE, but DeLLphi, as you know, uses a CD3 bispecific, and that gives you the long survival tail. We’re beginning to see data from the ADCs now that show really good durability and survival.

Amgen has a collaboration with Zai Lab, and they’re testing Zai Lab’s DLL3 ADC, which binds to a different epitope. They’re essentially using it to deliver the chemotherapy. There could be a case for combination therapy in the future, because, to your point, tarlatamab is going to be so entrenched. This is absolutely an area worth watching.

The first ADC is likely to be GSK’s in second line—at least GSK’s B7-H3 ADC.

On Summit, we had the MAP data from China. This was first-line BTC. We knew it had hit, but to be honest, I was very pleased to see the data that came out.

It supports a leading first-line position in China, too. Ivonescimab plus chemotherapy improved overall survival versus the Imfinzi control arm, which was interesting to see. I think the control arm performed better than, or in line with, what we’ve seen before. It was a little stronger than what we saw in TOPAZ-1, the Imfinzi trial in China.

Despite that, ivonescimab improved both overall survival and progression-free survival. So that’s yet another tick in the box for ivonescimab. I think the community is coming to the conclusion that this is clearly an active drug. I’d love to hear what you’ve been hearing, Yaron. It’ll be interesting to see whether the benefits translate to the West, and in which patient groups. I’m hearing that people are getting warmer on squamous non-small cell lung cancer than on nonsquamous disease, but let’s see when the HARMONi-3 data come out.

Yeah, no, I agree. I think it really depends on the magnitude of the benefit. These are active drugs, and they’re probably providing a modest benefit, but there’s absolutely no toxicity, and they could become standard. There are going to be some tumors where they absolutely become standard, and others where it’s going to be a bit of a wash.

I think we’ll miss out on the gastric cancer data from AstraZeneca given the time. Why don’t you talk about Genmab, which has had an enormous run of positive data sets and is really positioning itself to manage the downturn it’ll get from Darzalex?

Genmab has historically derived most of its revenue from royalties related to Darzalex, due to its antibody engineering, but it’s increasingly moving toward having its own pipeline. It has launched Epkinly, now the leading CD20×CD3 bispecific with AbbVie. They’ve had 3 data sets. The frontline Epkinly data read out recently, with a complete home run: a 51% reduction in the risk of progression or death. That’s going to become standard in the frontline setting.

On Friday, they put out a press release with the Rina-S Phase 3 data in ovarian cancer, head-to-head against the standard of care, Elahere, from their partner AbbVie. They showed a statistically significant benefit. It was a complete home run across the board, with a 60% to 70% reduction in the risk of death. Elahere is an ADC targeting folate receptor alpha, which is expressed in about a third of patients, or 40% of high expressors. Rina-S worked across the board, regardless of expression, because the drug is so powerful. It also worked equally well in patients who had failed Elahere.

That’s going to become the standard of care in the second line, and now they’re in a race with Eli Lilly to the frontline. Lilly was behind, so they’ve essentially given up the second-line market and jumped right into frontline studies, as Genmab is doing. Our consultants are saying Rina-S will become the standard in the second line, and there’ll be a race between Lilly and Genmab in the frontline. Other drugs and ADCs are behind, but they’ll have to try to match this kind of survival benefit or ultimately be used after folate receptor alpha.

On Wednesday, they presented updated Phase 2 head and neck data. Remember, they acquired Merus, and the drug is petosemtamab. They presented the updated data and then scheduled a webinar, as they always do, to talk about it. Then they quietly reported the Phase 3 data we’ve all been waiting for. It was a ballpark home run. The data was phenomenal: a 50% reduction in the risk of death. It worked regardless of HPV status, whether patients were positive or negative. Current drugs are used in HPV-negative patients, who make up 80% of the population. This drug is going to work in everybody, so there’s no need to test anymore.

That was only the topline data, but you can see Genmab has doubled in the last 3 months. We think that with these 3 drugs, they’ve essentially closed their 2029–2030 cliff, when the Darzalex royalties go away, and they’ll be a growth stock even through that. Of course, they’re going to be launching 3 blockbuster drugs by the end of next year, early 2028. This is a stock that’s getting rerated now. It’s amazing and really terrific to see this level of innovation. Petosemtamab is a first-line drug. Epkinly is best-in-class; it’s actually the second one approved, but the first one in follicular lymphoma. The data has been really strong across the board.

We often talk about how successful M&A can be in the hands of large pharma. Hats off to them for doing these deals. The stock went through a bit of a tough patch from early spring into the summer, so hats off to them for delivering so much in such a short period of time.

Lastly, Chris, if you allow us, we’ll quickly talk about Tango. It’s a little bit like the M&A situation: the data came out and we thought it looked pretty good. This is the PRMT5 drug vopimetostat, combined with RAS inhibitors for MTAP-deleted, RAS-mutant pancreatic cancer. There are a bunch of other companies—I know Yaron wants to talk about this—including Bristol Myers Squibb and IDEAYA, which have these drugs. I like the data. There are some questions, and we’ve been chatting with Eric about what he’s been hearing, but we were impressed. People always worry about someone going up against Revolution Medicines now. Did you want to comment on BMS?

Let’s stay on Tango and compare it with BMS. Tango has an unofficial—not formal—clinical collaboration with Revolution Medicines. The goal is to combine Tango’s PRMT5 inhibitor with Revolution Medicines’ RAS(ON) inhibitor, which just got approved and is going to be broadly used. The challenge is that Tango’s PRMT5 inhibitor increases exposure to Revolution Medicines’ drug by threefold. The data was phenomenally good in pancreatic cancer, so that’s not the issue. The issue is the drug-drug interaction and the pharmacokinetics. That’s fairly awkward for Revolution Medicines, because now they’ll need to use a third of their drug. What happens with pricing? What happens with labeling?

There’s another company, BMS, with a PRMT5 inhibitor that’s looking really good. BMS is global, moves at lightspeed, and isn’t expected to have a drug-drug interaction. They actually did a formal partnership, so BMS is now going to co-develop the drugs globally. They have rights to some of the assets in Asia, and they have a clinical collaboration that gives them access to a supply agreement, which Tango does not have. Tango is going to have to buy the drug from Revolution Medicines and pay for it, which is going to be fairly tough.

BMS moves at lightspeed, and they’re way ahead in lung cancer as a monotherapy. Now they’re going to do the pancreatic cancer combination with Revolution Medicines. BMS was 40 months behind Pfizer in Phase 3, and they’re probably going to end up reading out data at the same time from their CDK4 Phase 3. BMS is a huge competitor, and they have their own RAS agents in Phase 1, too. This is going to be a phenomenal area to watch, but the BMS pipeline is one of the best in the industry right now in oncology.

Wow. We’re out of time, so I can’t push back. Thank you both.

No, no, no. Go, Chris. Quite a tour de force, and a lot going on in the cancer space. We should close. Any final comments from anybody? Sam, were you going to say something?

No, it was going to be about Tango and PRMT5 inhibitors, but we’ll do it another time.

All right, great. Thanks, everybody, for tuning in. We look forward to having you on the next Biotech Hangout. Thanks, everybody, for tuning in. Thanks, all.

Stop yelling.